COIN?
NO.
IT IS STILL AT 3600.
YOU GOT IT.
>>> IT IS OFFICIAL, SEARS
SURVIVES, AT LEAST FOR NOW.
EDDIE LAMPERT WILL PAY 5 BILLION
TO KEEP ABOUT 400 SEARS STORES
OPEN.
GERALD STORCH WITH US ON THIS,
THE FORMER CEO OF TOYS "R" US.
HE IS THE MAN WHO TURNED TARGET
AROUND.
VERY FAMOUS GUY IN THE RETAIL
BUSINESS.
GERALD, WELCOME BACK.
GREAT TO SEE YOU AGAIN.
>> GREAT TO BE HERE.
STUART: CAN YOU REALLY KEEP
SEARS ALIVE?
WILL IT WORK?
>> I THINK THEY CAN REOPEN OR
STAY OPEN BUT IT WILL BE
DIFFICULT.
THE FUNDAMENTAL PROBLEMS WITH
SEARS REMAIN AND THE STORES ARE
VERY WORN DOWN.
THE RETAIL CONCEPT HAS
ESSENTIALLY FAILED.
ITS LOST ITS CONSUMER RELEVANCE.
A SMALL POCKET OF CONSUMERS,
ELDERLY PEOPLE, MAYBE PEOPLE IN
CERTAIN GEOGRAPHIC AREAS SHOP
THERE, BUT BY AND LARGE IT IS
OFF THE RETAILP MAP.
UNLESS THEY HAVE A FUNDAMENTAL
CHANGE IN THE CONSUMER VALUE
PROPOSITION, THIS WILL BE A
DOUBLE FLOP.
THE STORES WILL STAY OPEN, BUT
FAIL DOWN THE ROAD NOT TOO LONG
AGO.
STUART: WHOSE $5 BILLION IS
BEING WASTED HERE IF THAT IS
YOUR JUDGMENT BEING WASTED?
>> SOME OF IT IS CREDITORS.
SOME IS EDDIE LAMPERT'S.
HE IS TAKING FUNNY MONEY, DEBT
THE COMPANY OWES HIM, USING THAT
TO GO BACK TO BUY THE COMPANY.
HE ALSO PUT REAL CASH INTO THE
COMPANY OF HIS OWN.
HE CONTINUES TO HAVE FAITH WHAT
IS GOING ON THERE EVEN AS THIS
COMPANY HAS SLID INTO THE ABYSS
SINCE HE WAS FIRST INVOLVED IN
2000, ROUGHLY 14 YEARS AGO.
WHERE HE WAS A 50 BILLION-DOLLAR
COMPANY.
NOW, AFTER REOPENS I WOULD
EXPECT TO BE SINGLE-DIGIT
BILLIONS OF DOLLARS OF SALES.
ACTUALLY IRRELEVANT IN THE
LANDSCAPE OF RETAIL SALES IN
AMERICA.
STUART: YOU'RE THE GUY WHO KNOWS
MORE ABOUT RETAILING THAN ANY
OTHER GUEST ON THIS PROGRAM.
I WILL DECLARE THAT I THINK THAT
IS TRUE AND I WANT TO TALK TO
YOU ABOUT MACY'S.
THEY TURNED IN A POOR
PERFORMANCE THIS PAST HOLIDAY.
THE STOCK WAS WHACKED.
WHAT HAPPENED TO MACY'S?
>> WELL I THINK PEOPLE ARE
CONFUSING THE FUNDAMENTAL RETAIL
TRENDS TAKING PLACE WITH THE
HEALTH OF THE AMERICAN CONSUMER.
SO WHAT IS GOING ON WHICH IS NO
SURPRISE TO ANYONE THAT SALES
ARE SHIFTING FROM TRADITIONAL
DEPARTMENT STORES TO MASS
MERCHANT STORES LIKE COSTCO AND
TARGET WHICH HAD SPECTACULAR
HOLIDAY RESULTS AND OF COURSE
SALES ARE SHIFTING TO THE
INTERNET.
MACY'S HAS BEEN TRYING TO KEEP
UP, DOING AS GOOD A JOB AS
ANYONE CAN BUT IT IS ESSENTIALLY
YESTERDAY'S CONCEPT BECAUSE
DEPARTMENT STORES OF THE PAST,
YOU KNOW, ARE NOT SO RELEVANT
FOR THE FUTURE BECAUSE IN THE
FUTURE THE INTERNET IS THE
DEPARTMENT STORE.
YOU CAN BUY EVERYTHING YOU WANT
SITTING AT YOUR DESK ON THE
INTERNET.
YOU DON'T NEED TO GO TO
MULTIDEPARTMENT RETAILER IN
ORDER TO GET YOUR GOODS.
SO IT IS NOT THAT THE CONSUMER
WAS WEAK OVER THE HOLIDAY.
CONSUMER WAS VERY STRONG.
THEY DON'T LIKE DEPARTMENT
STORES ANYMORE.
WE SAW BAD NUMBERS, WE SAW WEAK
NUMBERS OUT OF NORDSTROM
YESTERDAY AND THEY ARE THE
CLASS, CLASS ACT BY FAR OF
DEPARTMENT STORES BUT THEY ARE
FULL LINE DEPARTMENT STORES
WHICH ARE STORES LIKE MACY'S
WERE UP FRACTIONALLY, A FEW
TENTHS OF ONE PERCENT
SAME-STORE SALES.
VERY ILLUSTRATIVELY THE
NORDSTROM RACK, OFF-PRICE
CONCEPT, UP 3.9% IN
SAME-STORE SALES.
I EXPECT GOOD NUMBERS LIKE TJ
MAXX AND OTHER CONCEPTS WHEN
THEY REPORT.
STUART: THAT IS FASCINATING.
WHILE YOU'RE HERE, GERALD, TALK
TO ME ABOUT AMAZON.
I HAVE NOT SEEN ANY OFFICIAL
NUMBERS ABOUT THEIR SALES GAINS
OVER THE HOLIDAYS.
HAVE YOU BOTTOM A NUMBER ON
AMAZON?
>> MY ESTIMATE IS APPROXIMATELY
20%.
STUART: WHOA.
>> E-COMMERCE SALES GREW BY 17%
ACCORDING TO ADOBE ANALYTICS AND
AMAZON IS FRANKLY HALF OF THE
INTERNET RIGHT NOW IN TERMS OF
INTERNET SALES.
NO WAY THAT NUMBER IS 1AND THEIR
NUMBER ISN'T IN THAT VICINITY.
I THINK IT IS LITTLE BETTER THAN
THE AVERAGE.
DESPITE THEIR HUGE SCALE, THEY
CONTINUE TO GROW, TAKE SHARE.
I PUT OUT AN INDEX, STORE MUCH
ADVISORS SAME-STORE SALES INDEX.
UP 4.5% OF RETAILERS REPORTED
WHICH IS VERY ROBUST.
VOLUME WEIGHTED FOR SALES OF
RETAILERS.
AMAZON NOT REPORTED.
WALMART NOT REPORTED.
WE'LL KNOW A LOT MORE WHEN THEY
DO.
IF YOU PUT AMAZON, GREW AT ANY
SCALE LIKE 20%, RETAIL SALES FOR
THE RETAIL INDUSTRY GREW MORE
THAN 4.5%.
MORE LIKE FIVE OR 6% FOR THE
HOLIDAYS WHICH SHOWS THE
CONSUMER IS IT SILL STRONG.