Sears to set to open first batch of smaller U.S. stores

A sign for a Sears Outlet department store in Norristown, Pa., on Oct. 15, 2018. (Matt Rourke / AP)

NEW YORK -- After its journey through bankruptcy, Sears is getting ready to open its first batch of smaller U.S. stores that won't carry clothing but will focus on appliances, mattresses and home services.

The first three stores called Sears Home & Life will open on Memorial Day weekend and are a fraction of the size of the company's traditional stores.

Peter Boutros, chief brand officer for Sears and Kmart, declined to say how many of the stores are in the works but said locations have been identified. However, he said the new-format stores will not take the place of Sears' remaining 425 stores.

The company also plans to ramp up TV advertising and is planning to extend its Kenmore brand beyond major appliances into kitchen accessories, plates and knives.

The new smaller stores will be located in Overland Park, Kansas; Lafayette, Louisiana; and Anchorage, Alaska, Boutros said. They range in size from about 10,000 to 15,000 square feet (900 to 1,400 square meters). The average Sears is about 155,000 square feet (14,400 square meters).

The moves come nearly two months after Sears Chairman Eddie Lampert bought the Hoffman Estates, Illinois-based company for $5.2 billion in a bankruptcy auction through an affiliate of his hedge fund. With the deal, Sears retained the Kenmore appliances and Diehard battery brands and continues to sell Craftsman tools through licensing partners. The company sold Craftsman tools to Black & Decker in 2017. Sears filed for Chapter 11 bankruptcy in October 2018.

"We need to instil confidence that we are open for business," said Boutros in an interview with The Associated Press, declining to comment on recent sales trends.

Lampert is restructuring the business, but Sears' long-term survival remains an open question. It has to contend with increasing competition from the likes of Best Buy, Home Depot and Walmart.

Each of the new stores will sell both major and small kitchen appliances. Customers can meet with experts to explore how new appliances will look in their home. They will also have kiosks where shoppers can order items available online and in the regular stores and can have them be delivered to the store or delivered at home.

Boutros declined to comment on sales projections for the new store formats.