Sears, an early innovator of shopping from home, is bankrupt of new ideas

Let me sum up the demise of Sears with a little math that does not involve a trusty spreadsheet, an advanced marketing degree or any understanding of arcane Wall Street financing or bankruptcy law

Ponder Crock-Pot’s Cook-N-Carry six-quart slow cooker. Your basic set-it-and-forget-it-all-day kitchen appliance.

At Amazon, it sells for $25. Wal-Mart? $25. Target? $25. At the manufacturer’s own online store? $30.

At Sears.com — which is pitching a slow-cooker sale on its front page … $34.

Need I say more? Where would you go shopping?

Nobody should be particularly stunned Sears is now operating under bankruptcy court supervision. It’s a last-gasp effort to keep alive one of the great American store brands — and its sister chain Kmart.

The chains simply ran out of cash after selling off almost every valuable asset or shuttering the ones that did not pencil. Sears Holding Corp. is also closing another 142 stores nationwide in a desperate move to remain afloat. Court documents indicate five Southern California stores — Sears in Costa Mesa, Cerritos and Montebello and Kmarts in Ontario and Riverside — will shut.

The company has become an irrelevant brand stuck between merchants selling better stuff and those selling comparable goods for less. Even if the court-supervised rescue works — and there are serious doubts it will — the Sears at which generations shopped is dead.

This bankruptcy is no surprise. The brand, which once brought innovative sales to your home, has been on life-support for years.

Great American tale

Retailing is a constant war — one that battles for consumer dollars while keeping up with shoppers’ changing tastes and economic fluctuations, no less. That makes the industry a breeding ground for innovation as well as corporate implosions.

Sears, an idea hatched in 1893, was both.

If its company founders — Minnesota railroad man Richard Sears and Indiana watchmaker Alvah Roebuck — were alive today they very well might be hip, store-less sellers of timepieces. That’s because in its heyday Sears understood American shoppers so well it changed how consumers bought goods.

Sears and Roebuck brought a broad selection of goods to small-town America through its mail-order catalog, a concept that was as revolutionary at the start of the 20th Century as shop-by-click was as the 21st century began. Yet there are eerie twists in Sears’ corporate history that show how nimbly the company once could adjust.

For example, when the automobile’s growing popularity in the 20th century allowed more consumers to go pick up goods — bypassing the mail and challenging the catalogs — Sears jumped to the suburban shopping mall. Oh, and you could pick up mail-order Sears goods at the store, too.

In the 1930s, Sears also pioneered modern store merchandising. New Sears outlets in Glendale and Los Angeles were seen as cutting-edge with spacious aisles of goods. Sears’ hook into suburban shopping helped it leapfrog the dominant chains in the city center after World War II to become America’s No. 1 merchant.

Ponder Sears’ Costa Mesa store. It’s hard to think of the chain’s lowly image today, then recall how getting Sears as an anchor for South Coast Plaza’s opening day lineup a half-century ago was a coup for the now ritzy, world-class mall. Sears sold its space back to SCP’s owners, the Segerstrom family, last year and became a rent-paying tenant with a murky future.

Innovation hub

Sears didn’t just rest on its laurels as a master merchandiser of other’s goods.

Its retailing demise wasn’t like, say, Toys ‘R Us, which failed to leverage its appeal past the kiddie niche. This wasn’t Radio Shack, done in by the electronics innovation it once fueled. And it wasn’t a brand gobbled up and put under the Macy’s umbrella.

Why not? Because Sears had been able to diversify its consumer clout.

Its key store brands — Kenmore appliances and Craftsman tools — became household staples. The company branched out in the 1980s into financial services — Allstate insurance, Dean Witter stockbrokers, Coldwell Banker real estate shops and the Discover credit card.

And when you ponder the damage online shopping did to Sears, it’s painful to think it was a really early player in bringing online information home. It partnered with IBM and General Electric to create Prodigy, a late 1980s proprietary computer network that pre-dated widespread use of the Internet.

Spinoff to death

Wall Street’s preferred corporate shape changes almost as often as what’s fashionable in the retail world.

By the 1990s, retailing was just part of Sears’ empire. The lure of a hot stock market — and a new preference for simpler corporate storylines — nudged Sears to be a seller.

Of its non-retail brands.

Dean Witter, Allstate, Discover … even Prodigy were all jettisoned to help pay down debts as well as focus the corporate profile. And by 2004, when Sears merged with Kmart, the company was heralded as an American institution returning to its retailing roots … to fight the mall battle with the new storefront powerhouse, Walmart.

Of course, mergers usually only work due to “synergies.” The promise of elevated execution with shared “best practices” was quickly overshadowed by the bottom-line lure of cost-cutting.

Initially, pruning an already lean Sears-Kmart made Wall Street happy. Market valuation peaked at $24 billion in early 2007. But the fallacy of hope in a nationwide chain of mass-merchandise stores was exposed by the Great Recession. Sears and Kmart could not meet the residual consumer demands for discounts and online shopping’s ability to better deliver it.

Equally hurtful was the slimmed down Sears and Kmart had no other businesses to buttress retailing’s challenges. The company was forced into an all-too-common corporate death spiral. Selling or closing stores to stay afloat only left the company smaller and weaker requiring further prunings.

Today, Wall Street values Sears at almost zilch. Online shopping giant Amazon, which was worth roughly the same as Sears back at the traditional retailer’s stock zenith in 2007, is valued today at $900 billion-plus.

It’s anybody’s guess as to when the long slide at Sears will end. But I’m fairly sure most shoppers won’t notice.