Newspaper article The Canadian Press

Sears Canada Chief Says Some of Its Business Is Struggling, Needs 'Reset'

Newspaper article The Canadian Press

Sears Canada Chief Says Some of Its Business Is Struggling, Needs 'Reset'

Article excerpt

Sears Canada CEO sees need for 'reset'

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TORONTO - Sears Canada chief executive Calvin McDonald says there is still much work to be done as the department store retailer reconsiders what it sells in its stores and how many locations it operates.

"We don't have our balance 100 per cent right," McDonald said at the company's annual meeting on Thursday.

"There are still businesses that we're in today ... that are struggling, declining in the marketplace and we need to reset."

A year into a major transformation McDonald outlined to shareholders the efforts that have been made and some of the plans for the future. He said the company is about "halfway through" the changes.

So far, Sears Canada has managed to save about $100 million in costs and McDonald hopes to squeeze another $100 million to $200 million over the "next few years."

Various options are on the table after laying off about 700 employees earlier this year and closing four of its prime stores.

"We don't intend to exit any locations but as we look at creating value through our assets ... we're doing the right due diligence to evaluate those," he said.

"We will continue to review our business' processes and improve where we allocate resources and ensure that we have the right size for the volume we have today and for the future," he said.

The adjustments won't all necessarily impact its retail operations directly. Sears owns backroom operations that McDonald suggested could be outsourced, like the company did with its Sears Card in 2005.

Sears has been hurriedly making reworking how it operates as competition in the retail sector intensifies, encouraged partly by the entry of Target into Canada -- which opened its first stores outside of the United States last month.

Other U.S. retailers like Marshalls have also made inroads into the Canadian market, adding extra pressure to standout.

"If we want to remain relevant, we've got to continue to adjust," McDonald said.

Gone from its main department stores will be electronics and window coverings. Toys are now sold only online and more changes are in the works, like a scaled down selection of its Craftsman hardware products. …

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