Sears has filed for bankruptcy and announced it would close more than 140 stores, but it isn't the only department store that has struggled recently - here's why

Jessica TylerOct 18, 2018, 23:53 IST

Business Insider/Jessica Tyler

Sears filed for Chapter 11 bankruptcy protection on Monday, announcing it would be closing 142 Sears and Kmart stores and beginning liquidation sales at those locations immediately.
Sears isn't the only department store that has struggled recently. Macy's and JCPenney have also had to close stores in recent years.
There are a number of reasons why department stores are struggling, including that consumer habits are shifting towards online shopping as mall foot traffic declines.

Sears filed for Chapter 11 bankruptcy protection on Monday, announcing it would be closing 142 Sears and Kmart stores and beginning liquidation sales at those locations immediately.

The bankruptcy filing comes after years of crippling sales declines.

"Over the last several years, we have worked hard to transform our business and unlock the value of our assets," Sears' then-CEO, Eddie Lampert, said in a statement. "While we have made progress, the plan has yet to deliver the results we have desired, and addressing the Company's immediate liquidity needs has impacted our efforts to become a profitable and more competitive retailer."

Lampert stepped down as CEO on Monday but will stay on as chairman of the company's board.

Sears isn't the only department store that has struggled recently. In early 2018, both Macy's and JC Penney announced that they would be closing a number of struggling stores, and Lord & Taylor announced that it would be closing up to 10 stores, including its iconic flagship on New York's Fifth Avenue.

There are a number of reasons why department stores are struggling, including that consumer habits are shifting towards online shopping as mall foot traffic declines.

Here's a closer look at why department stores have been floundering:

See Sears has filed for bankruptcy and announced it would close more than 140 stores, but it isn't the only department store that has struggled recently - here's why >>

The rise of e-commerce has played a major role in the decline of department stores.

Department stores are being forced to face up against giants like Amazon and Walmart, and many are coming up short in their e-commerce offerings.

Source: Business Insider

Macy's, JC Penney, Sears, and Lord & Taylor are all closing stores.

Lord & Taylor is growing its e-commerce business, opening a new dedicated website on Walmart's website in addition to its own website.

Source: Business Insider

As a result of more shoppers turning to online stores, there's also been a decline in foot traffic to malls.

Stores like Sears end up feeling abandoned.

A higher demand for off-price products is also taking a toll on department stores.

Stores like TJ Maxx and Marshalls carry brands like Michael Kors, Tommy Hilfiger, and Calvin Klein for less than department stores, so many shoppers are more likely to shop at the off-price retailers.

When Lord & Taylor's flagship store began its closing sales, it started to look more like an off-price retailer, with massive sale signs and cluttered clothing racks everywhere.

The decline of the middle class has also taken a toll on department stores.

Source: Business Insider

The most successful stores in retail right now are luxury stores and budget stores, and those that depend more on middle-class spending aren't doing as well.

Source: Business Insider

Many of the struggling department stores aren't in the best shape.

JCPenney and Lord & Taylor were very cluttered during our recent visits ...

... and sales signs were everywhere.

On our most recent trip to a Sears store in Jersey City, New Jersey, we saw firsthand how the store was being affected by these issues. There were sale signs everywhere, and the store was completely abandoned.

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Sears has filed for bankruptcy and announced it would close more than 140 stores, but it isn't the only department store that has struggled recently - here's why

The rise of e-commerce has played a major role in the decline of department stores.

Department stores are being forced to face up against giants like Amazon and Walmart, and many are coming up short in their e-commerce offerings.

Macy's, JC Penney, Sears, and Lord & Taylor are all closing stores.

Lord & Taylor is growing its e-commerce business, opening a new dedicated website on Walmart's website in addition to its own website.

As a result of more shoppers turning to online stores, there's also been a decline in foot traffic to malls.

Stores like Sears end up feeling abandoned.

A higher demand for off-price products is also taking a toll on department stores.

Stores like TJ Maxx and Marshalls carry brands like Michael Kors, Tommy Hilfiger, and Calvin Klein for less than department stores, so many shoppers are more likely to shop at the off-price retailers.

When Lord & Taylor's flagship store began its closing sales, it started to look more like an off-price retailer, with massive sale signs and cluttered clothing racks everywhere.

The decline of the middle class has also taken a toll on department stores.

The most successful stores in retail right now are luxury stores and budget stores, and those that depend more on middle-class spending aren't doing as well.

Many of the struggling department stores aren't in the best shape.

JCPenney and Lord & Taylor were very cluttered during our recent visits ...

... and sales signs were everywhere.

On our most recent trip to a Sears store in Jersey City, New Jersey, we saw firsthand how the store was being affected by these issues. There were sale signs everywhere, and the store was completely abandoned.