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Sears Drops ‘Essentials’ Strategy

2/23/2006 11:59:00 AM Eastern

Hoffman Estates, Ill. — Sears Holdings said it will convert its 50 Sears Essentials locations to downsized Sears Grand stores beginning next quarter.

Sears Essentials was introduced one year ago as a Kmart store conversion that combined the discount chain’s traditional strengths — quick-turn convenience items like food, pet supplies, toys, and health and beauty aids — with Sears’ core hardlines assortment, including majaps and tools.

Plans had originally called for the conversion of 400 Kmart locations by next year. But last December Sears conceded that the format had met with “varying degrees of success,” and that expansion plans would be curtailed.

Essentials was essentially a smaller version of the company’s Sears Grand stores, a larger full-line, off-mall format that carries CE, majaps, tools, soft lines and fast-turn convenience items. Sears acknowledged the similarities between the two chains, which led to its decision to consolidate the stores under one moniker.

Fourteen Kmart locations will be converted to Grand stores this May, with the balance of Essential stores to follow soon after. Sears said the new Grand stores will feature upgraded flooring, fixtures and signage, and departments will be designed to resemble separate shops.

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