As Sears goes through bankruptcy, we will likely see nostalgic perspectives on the 130-year-old retailer. But through the ups and downs of retail, one constant remains; consumers decide and the market always wins.
Fifty-years ago, if one had suggested Sears would go bankrupt and just a fraction of their stores would remain open, most sane people would have laughed. Now, we know the rest of the story. Sears started as a mail-order catalog before transitioning into a brick-and-mortar force that grew with suburban America and the boom of indoor malls.
That boom included Jackson, Mississippi. While Sears long had a presence in the city, it would serve as the first anchor for the new Metrocenter Mall in 1978, the state’s largest mall. For years, both Sears and the mall hummed along…until people began to make other choices. In 2012, Sears was the last anchor to leave, effectively ending whatever claim Metrocenter still had at labeling itself a mall.
There has already been – and there will continue to be – stories about mismanagement at Sears or about some other decisions from the past decade or so that necessitated the bankruptcy. But we know what killed Sears. It was the same thing that made Sears into a retail giant – creative destruction. Fighting to give consumers new and better options, Sears created unique and valuable shopping experiences for consumers. Today, other options are causing consumers to spend their money elsewhere. It is the order of things in a free market.
The “elsewhere” might be Wal Mart, which is able to sell goods at a deeper discount than Sears, while also selling groceries. It might be Best Buy or Home Depot/ Lowes, which offer Sears-size stores for a single retail category, providing consumers with far greater choice. Perhaps it’s Amazon, which has put pressure on every remaining retail giant. In the final analysis, nothing remained in the value proposition of Sears that gave people a compelling reason to shop there.
In the end, capitalism gave us better options. Creative destruction, which has been the driving force behind American ingenuity for the past century, ruled the day.
Someone else provided the market with a value proposition that consumers voluntarily decided was better. In much the same way that, once upon a time, Sears provided a better value proposition than general stores or five-and-dimes, which had dotted downtowns in an earlier era. The same creative destruction that made Sears a retail juggernaut would eventually be the reason for its slow death over the past decade.
Sears gave the masses access to affordable household goods largely before anyone else. But the free market, and retail in particular, is about appealing to modern tastes and changing behavior. For many years, Sears had been losing its relevance. Nostalgia is good for writing an obituary, but is largely unhelpful in keeping most businesses open.
No one likes to see a business close, particularly one that has been around for more than a century and likely evokes found memories from early eras. But for consumers in Mississippi and around the country, we don’t have to worry. The market, via you, the consumer, spoke long before Sears filed for bankruptcy protection.