A long-running business partnership has finally come to end, as Sears announced they’d be dropping Whirlpool products from their stores.
Sears, Roebuck, and Co. was founded in 1887, and has been faithfully selling Whirlpool products for over a century. The end of the long-running relationship seems to be based on financial reasons.
Sears released a memo last week to stores, noting that Whirlpool’s new pricing demands made it impossible for the store to offer their products at a reasonable price. Whirlpool also makes Jenn-Air and KitchenAid products, making them a top name in the area of home appliances.
The company has committed to finish selling the Whirlpool products currently in their inventory. Likewise, Whirlpool has agreed to continue supplying Sears with ten appliances under the Kenmore brand. Whirlpool makes Kenmore refrigerators, dishwashers, washers, and dryers.
Whirlpool CEO Marc Robert Blitzer confirmed the mutual split as a result of the companies’ inability to reach an agreement. “We did inform Sears in May that we would no longer supply Whirlpool branded products as we simply could not reach terms that are acceptable to both parties.”
Sears mentioned they’d be keeping other top brands that consumers know the store for. These include names like Samsung, LG, Frigidaire, GE, and more.
The change does more than spell the end for a historic partnership – it shows how Sears has gone through major changes in recent decades. The retail giant was once a go-to resource for everything from clothing to home amenities. Now, amid recent economic troubles, the chain is experiencing a major slip in popularity.
Not only is the struggling store being outdone by retail competitors like Walmart and Target, but they’re also feeling the heat of the online-shopping phenomenon. More people are turning to online retailers for affordability, variety, and convenience.
Though the move doesn’t represent any drastic financial problems, it shows the continued downward trend the chain is going through. Their shares dropped to $6.36 during trading after the announcement was made, a 3 percent drop. However, Whirlpool took a harder hit. Their prices dropped to $164 per share, a plunge of 10.14 percent.
Sears has already taken measures to cut costs over the past few years. 2017, like the years before it, saw several rounds of store closures. With many Sears and K-Mart locations closing their doors forever, the company is clearly taking steps to save money.
Sears isn’t the only retailer feeling the pressure of a changing economic landscape. Even their competitors in the area of home amenities like Home Depot and Lowes are being stressed by increasingly efficient online-shopping options. Though these locations each have their own online-shopping setups in place, it’s hard to compete with the likes of Amazon and eBay.
As for Sears, they’ve already taken steps to restructure their company and cut waste. They launched a program earlier in 2017 to cut over a billion in debt and costs. As part of this plan, they severed another relationship – they sold Craftsman, one of their top brands, to Stanley Black & Decker.