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Merging any two companies requires change management communications to ensure employee promotion and trust in the business decision. However when the merger is among two of the nation's most recognized brands, the change has greater impression and expectations are higher.
The year of 1992 was the worst year on record for Sears, losing almost 4 billion dollars on over 52 billion dollars in retail sales. The early and mid 1990s were truly trying times for the retail giant and tested the will and resolve of managers and employees alike. During this time the company was in near shambles, morale was low, revenues were suffering, and the bottom line was hemorrhaging red ink. This was in stark contrast to nearly a century of stellar results that Sears had comfortably enjoyed. For Sears, something needed to be done, and fast!
January 22, 2002 Kmart filed bankruptcy, closed nearly 600 stores and fired 57,000 employees, with $17 billion in assets, is the biggest ever for an U.S. retailer. Decline in the company's liquidity resulting from its below-plan sales and earnings performance in the 2001 fourth quarter. The evaporation of the surety bond market, and an erosion of supplier confidence, as well as intense competition in the discount retailing industry, unsuccessful sales and marketing initiatives, the continuing recession, and capital market volatility.
Kmart's CEO Charles Conaway said the chain would reorganize as quickly as possible to "make a fresh start."
Due to slow sales and less traffic at both Sears and Kmart, the two have decided to merge creating one entity named Sears Holdings. Kmart has agreed to buy Sears for $11 Billion. This puts Sears Holdings at the third largest retailer b ...