Sears Expands Majap Distribution Channels

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In an effort to broaden its off-the-mall presence and stave off further majap market share gains by Lowe's and The Home Depot, Sears is testing sales of white goods through its California-based Orchard Supply Hardware (OSH) chain and has expanded its presence in the home builders' channel through the acquisition of Westar Contract Kitchen & Bath.

Sears chose four OSH stores, located in Burbank, East Modesto, Fremont and Long Beach, Calif., in which to stock refrigerators, washers, dryers, dishwashers and microwave ovens alongside tools, paint, plumbing and hardware.

The test follows Sears' decision to add majaps to each of its 163 freestanding Sears Hardware stores this year, which are being renamed Sears Appliance and Hardware.

“Our ability to leverage Sears and immediately offer a best-in-class appliance department and infrastructure to our customers complements our broad selection of top brands, legendary customer service and convenient shopping experience,” said OSH's Rob Lynch, general manager of the 84-store Sears subsidiary.

According to Beryl Buley, senior VP/general manager of Sears' home stores, initial feedback and results from the four pilot stores have been encouraging. “Sales of appliances at our Sears Hardware stores have exceeded our expectations and offering appliances through our OSH format is a natural extension,” he said. “We think this adds convenience for our customers who may not live near a Sears full-line store, and is consistent with Sears' plans to grow through off-mall and specialty locations.”

Sears has also added CE to its OSH assortment as part of a seasonal holiday gift offering.

Elsewhere, Sears has completed the acquisition of Westar Contract Kitchen & Bath, a Southwest supplier of high-end major kitchen appliances to the home builder and remodeler trades. Westar becomes the fourth contract appliance dealer acquired by Sears through its wholly-owned FBA Holdings subsidiary, joining McPhail's Appliance, with six showrooms in northern California and Reno, Nev.; Florida Builders Appliances, with six showrooms in southern Florida; and Standards of Excellence, acquired last June, with five showrooms in San Diego, Calif.

Buley said the latest deal “underscores our commitment to maintaining a leadership position in the appliance business and to serving the luxury home building market.”

Westar, founded in 1978, maintains showrooms in Las Vegas and Tempe, Tucson, Scottsdale and Peoria, Ariz. The company carries the Dacor, GE Monogram, Jenn-Air, KitchenAid, Maytag, Sub-Zero, Viking and Wolf majap brands, as well as architectural plumbing fixtures. Former owner Elyse Sioles will now serve as president and general manager. Terms of the transaction were not disclosed.

Separately, Vornado Realty Trust, a real estate investment trust that buys struggling retailers to cash in on the value of their real estate, purchased a 4.3 percent stake in Sears, sending the chain's stock up nearly 24 percent, or $1.9 billion, in a single day's trading. Vornado offered no comment on the move, although Sears said in a statement that it remains committed to retailing

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