In This Article:
Sears Holdings (NASDAQOTH: SHLDQ) may be in bankruptcy protection, but it's still operating and has plans for Black Friday that go beyond securing financing to keep its doors open.
The retailer hopes to use the start of the holiday shopping season to boost sales in a bid to eventually emerge from bankruptcy court protection as a much smaller but stronger business. Don't expect going-out-business sales, but do expect enticing "doorbuster" offers.
Image source: Sears Holdings.
Kicking it off on Thanksgiving Day
Hundreds of Sears and Kmart stores will close over the next few months, and a few dozen are heading straight to liquidation and won't be offering Black Friday sales. But the rest will open at 6 p.m. on Thanksgiving Day, close at midnight, and then reopen Black Friday at 5 a.m. Kmart stores will reopen at 6 a.m.
The trend of opening on Thanksgiving Day started in earnest in 2013 when a quirk of the calendar meant there were six fewer shopping days between Black Friday and Christmas. Having recently come out of the Great Recession and with a fear of another recession looming, retailers opened their doors to customers on the holiday. Each year thereafter, more stores opened in the hours ahead of Black Friday, but that created a backlash among consumers, as well as employees who had to work.
While the pendulum is beginning to swing back the other way, many of the largest retailers including Walmart, Macy's, and Kohl's will be open for business on Thanksgiving. Moody's believes most retailers don't benefit from opening on Thanksgiving Day as shoppers can only get to so many stores, and ShopperTrak data shows that after peaking in 2014, in-store traffic on that day has slowly but steadily been declining. It is also far, far less than what retailers enjoy on Black Friday itself.
Its last, best chance
Sears Holdings doesn't have the luxury of choosing whether to be open or closed -- it needs every dollar it can get if it hopes to survive. It just secured a last-minute $350 million loan to keep operating at least through the Christmas holiday, and if it can generate sufficient sales, it might even be able to repay the loan, which comes with an onerous price: the Libor rate plus 11.5%, along with a 3% closing fee.
In announcing its Black Friday schedule and some of the deals customers will find, Peter Boutros, Sears' and Kmart's chief brand officer, said, "We want our members and customers to know that we're open to serve them online and in stores, both at Kmart and at Sears."