Adjusted for the 2018 population that would be 84 million people today - nearing the same ballpark as Amazon Prime membership. That was more than 25% of the population at the time. In the year 1900, Sears sent its catalog to 20 million Americans. Sears was once the mightiest retailer around - the Amazon and Walmart of its day. Let’s take a closer look at how the Sears and Lampert story played out. If you don’t plan this out in advance, it’s far too easy to get sucked in, and before you know it, the consequences have spiraled out of control. The larger the investment, the more important it is to know the stakes and to know in advance the circumstances in which you would sell, cut losses, or walk away. The broad lesson here for investors is that you always want an exit strategy. Now Lampert has been forced out as CEO and Sears is on life support. In the eyes of investors, he could do no wrong.īut with the Sears merger, Lampert made the worst investment of his life and spent the next 13 years mired in that mistake. It’s also a cautionary tale - an example of the incredibly high costs that come with nursing a bad investment.Įddie Lampert, the billionaire hedge fund wizard who merged Kmart and Sears in 2005, was once seen as the deal-making heir to Warren Buffett. The story of Sears is a tragic tale of mismanagement and billions of dollars lost. But the company is burning $125 million in cash per month, and hundreds of vendors have stopped shipping merchandise to Sears stores for fear they won’t be paid.
If the creditors agree to a deal, Sears could keep its doors open. The 132-year-old retailer is now fighting for its life, hoping to avoid liquidation by creditors.Ībout 68,000 American jobs are at stake. We’re witnessing the fall of an American icon.
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