Sears stores have struggled with a consumer shift toward online shopping, tough competition from Wal-Mart Stores Inc. and Target Corp., and what analysts have decried as a cycle of underinvestment in stores, which many shoppers see as exhausted or lacking inventory, Crain's reported.
This is being justified as a pivot in the industry and follows a year of changes to Sears Canada aimed at restoring the standing of the American Sears spinoff, shares of which have also fallen as it controls a major stake in the Canadian offshoot.
Sears announced this spring that it lost more than $2 billion a year ago.
"We are making the hard, but necessary decision to close the Sears store and Sears Auto Center", Sears spokesman Howard Riefs said in an email late Thursday. The announcement came after the Ontario Superior Court of Justice granted the department store chain temporary protection from creditors under the Companies' Creditors Arrangement Act (CCAA).More news: BJP to declare presidential candidate on Tuesday
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But Sears, along with Macy's and J.C. Penney, are "future-proofing their offerings by closing stores", according to a new report from retail think tank Fung Global Retail & Technology.
Sears Canada was granted court protection from creditors on Thursday and announced plans to close 59 locations across the country and cut approximately 2,900 jobs under a court-supervised restructuring.
TravelBrands, which owns Sears Travel, said it is consulting with its legal team before making a statement.
The number of affected employees was not publicly available.
Sears' agreement with Seritage lets it end its leases at unprofitable stores in exchange for payment of one year's rent.