71.6 F
Thursday, January 26, 2023

Sears in Mexico thrive while its U.S. counterparts sink

Latest headlines

Yucatán Magazine
Yucatán Magazine
Yucatán Magazine has the inside scoop on living here. Sign up to get our top headlines delivered to your inbox every week.
A U.S. Sears store and one in Mérida, Yucatán, are studies in contrast. Photos: Courtesy

Like Woolworth before it, Sears in the U.S. appears headed to oblivion while its Mexican counterpart is doing just fine.

Sears Holdings in the U.S. announced Monday its Chapter 11 bankruptcy filing and plans to close more stores. Its store count dropped from 1,430 to 1,002 during fiscal 2017, and it’s closed, or announced plans to close, about 300 more stores since the beginning of 2018.

In contrast with the original Illinois-based Sears, Sears Mexico “remains strong and maintains a solid financial performance.”

Meanwhile, Sears Mexico opened new stores in Cuernavaca; Puebla and Mexico City and expanded five others.

Sears Mexico contributes 48.6 percent of Grupo Sanborns’ income, according to financial reports.

“Sears Mexico is very solid, has had good financial performance and is part of a strategy that has been carried out to find new market niches and reconvert stores,” according to its parent company, which is owned by Carlos Slim. Today it is more focused on the fashion sector.

Grupo Sanborns has the rights to the Sears brand until 2026:

“We will continue working with Sears and we are doing so well that this year we opened three new stores,” Sanborns said in a satement.

“Sears Mexico continues strong, has a good market share within the income of Sanborns group, and the project we have is to continue strengthening our operation in Sears, we have a solid performance,” the group said.

When the first Sears in Mexico City opened in 1947, it revolutionized retail, establishing fixed and competitive price policies instead of the traditional bargaining system. Chicago-based Sears opened stores throughout Mexico from 1955 to 1993. In 1997, Sears formed a strategic alliance with Slim, who 10 years later took complete control of Sears in Mexico.

Today, even the logos are different, and Sears in Mexico has a more upscale feeling than its American counterparts.

Whether or not the name survives in the U.S., Sears’ trajectory is reminiscent of another storied American brand, Woolworth. That historic chain vanished in the 1990s, but the name lives on in Mexico.

Retail brands have a longer shelf life in Mexico, where they don’t face as many competitors and fewer people buy online, according to Juan Martinez, president of research firm Superbrands Mexico.

Woolworth Mexicana broke off from the sinking U.S. company in 1997 and is now part of Grupo Comercial Control, a holding company.

Blockbuster was another chain no longer seen north of the border while the brand was revived in Mexico by investors. Eventually, technology advances caught up with the chain in Mexico, and those stores also shuttered.

- Advertisement -spot_img

More articles