Need a presentation based upon report and proposal

Letter of Transmittal

Abhay ohri,

Sears Canada Development manager and Sears Canada Sales manager

14 Main St, SK S0J 2E0,

Shellbrook, Canada.

September, 4 2018

Dr. Penny Farley

Sears Canada CEO

14 Main St, SK S0J 2E0,

Shellbrook, Canada.

Dear Dr. Farley:

The attached report explores the possible solutions to the financial issues facing the company. The focus of the report is the identification of solutions that will help stop the current liquidation process that has led to significant layoffs. In the report, we look at revenue increasing strategies as opposed to cost reduction strategies.

The report proposes the implementation of an employee-training program. Well-trained employees are more productive and lead to customer satisfaction. Therefore, training employees increase revenues through the increase in customer satisfaction levels. Another option recommended in the report is improving the store and the information system. An improved information system analyses the buying trends to help the company in stocking moving products.

On the other hand, an enhanced store outlook increases the marketability of the retail brands. Finally, the company can simplify its reward scheme to make it more attractive to the customers. A good reward scheme increases customer visits to the retail outlets.

Abhay ohri primarily prepared the report. However, other company employees including the financial manager and the Information Technology manager contributed to the report. Other stakeholders including customers, suppliers, and creditors were consulted when preparing the report.

The report concludes that it is possible to end the issues at Sears Canada through simple restructuring. We recommend that the liquidation process should be stopped to avoid layoffs and store closure. The company is capable of generating profits through its employees, operations, products, and services.

Your consideration of the report is greatly appreciated,

Yours Sincerely,

Abhay ohri

Decreasing Number of Retails Outlets (Sears Canada)

Prepared for

Dr. Penny Farley

Sears Canada CEO

Prepared by

Abhay Ohri

Sears Canada Sales manager

September 4, 2018

Abstract

Sears Canada has experienced increased competition in the past decade. Part of the competition comes from an online retailer. Sears has also experienced financial issues that have influenced branch closure and mass layoffs. This report looks at possible profit-making strategies that will stop the current liquidation process in the company. In the report, training employee training and store improvement have been advocated. Improving the reward scheme and the information system has also been recommended. The recommended changes will be implemented in four phases commencing January 2019 to September 2019. Total estimated costs stand at $ 5,600,000. Sears Canada is advised to the halt the liquidation process and embrace the proposed restructuring process.

Table of Contents

Introduction

The report on Sears Canada is meant for the board of directors to influence their decision on saving the company. Employees can also use the report to explore the effects of the recommendations to their livelihoods. The report is also meant for creditors and suppliers who have money invested in the company. Other stakeholders in the company including the Canadian communities that are served by Sears Canada can also use the report.

The report purposes to provide solutions to the financial issues Sears Canada is facing. Sears Canada is considering closing its operations in the whole of Canada. The report is meant to propose sales improvement strategies over liquidation in saving the company.

Sears Canada provides wide numbers of products with reasonable services and prices to consumers. Its retail business normally starts from purchasing products from market suppliers, that gives a discount at a volume markdown, and they have price variation of the products that depend upon supply and demand. Our company Sears Holdings had a long, organized and documented history of the good environment and social responsibility with its customers. Our company was founded in 1953 when it began serving the Canadians under the corporate banner of Simpsons-Sears Ltd. Sears has often been described as Canada’s largest retailer (Global news, 2017). The motive of the company is to attain customer satisfaction through quality products and exceptional services. We earned an identity of trust by the goodwill of our employees, staff members working for the prosperity of our company. Our staff works on the feedback from customer reviews, which makes a positive bond of trust among our customers.

There was a partnership between the retail chain Simpsons Limited in Toronto and Sears Roebuck Co. of Chicago. We launched our first retail store in Ontario, Simpson - Sears opened a second outlet in Kamloops, BC, in 1953 and after a year later a third store opened a store in Vancouver. In 1978, Hudson’s Bay Company obtained Simpsons and lot of the retail establishments were changed into The Bay, its lead store was in downtown Toronto. The Simpsons-Sears association was broken down; however, in February 2009 Sears had to cut down 300 employments short of cash and a workforce at a time to get ready for an extreme year in retail. We then offered to lease our stores in prime locations. In 2011, the CEO Calvin McDonald unexpectedly ventured down the retail outlets. In August 2016, Sears tried its best to rebrand its logo for the first time in 32 years, and we made famous comedian-actor, Mike Myers, our brand ambassador. On June 22, 2017, the effects of the recession led to Credit losses and reported plans to shut down 59 outlets, which employ 2900 people. In July, our sales fluctuated, and there was a considerable price variation in sales, which lead to 20-50 per penny.

The increase in retail companies in the 21st century has led to increased competition for Sears. This competition has influenced the low revenues for the company. Sears Canada is in a bad financial position, which threatens the survival of the company. Given the situation, the company has started liquidating its retail outlets in the whole of Canada (McKenzie, Burt, & Dukeov, 2018). We propose that the company should restructure its operations to increase sales instead of liquidating its operations.

Restructuring- The reorganization of the legal, management structural or corporate structure of an organization to improve performance.

Liquidation- Ending a business and distributing assets to those who have a claim on them including employees, shareholders, financial institutions and other creditors.

Layoffs- The sudden termination of employment of a group of employees before their retirement.

Leveraging- Borrowing funds from lenders to finance operations and the purchase of assets.

Problem Statement

Should Sears Canada choose sales improvement strategies over liquidation and Layoffs? The report explores the possibility of a successful restructuring through employee training and store improvement.

Research Methods and Qualification

The research is quantitative in nature. We will explore the possibilities of incorporating several restructuring approaches to Sears Canada. The research is designed to meet the current conditions of the company.

We are qualified to research the positions held in the company. Abhay understands the Sales needs of the company through the position of the Sales Manager.

Scope

This research is centered on how to increase profits for Sears Canada to prevent store closure and employee layoffs. The purpose of this research is to explain the methods we could implement to gain new momentum in the sales sector and how to reach new consumers and new products. The research will not explore the option of reducing costs at Sears Canada. Only the possibility of increasing revenue increase will be explored. The research has a time limitation due to the urgency of the situation. Sears Canada is already liquidating some of its branches and thus the need to speed up the research for an appropriate solution.

Solutions

Possible solutions to increase the sales. Should include improving the reward program, which will increase the market share through encouraging customer loyalty. A simple reward program should be implemented. When the reward program is complicated, the customers will not be loyal to the company or the brand (Kumar, & Reinartz, 2018). Online shopping is the fast and cheaper most of the time. Another possible solution is to increase the online presence of the company. Online sales are becoming a trend for retailers in the global sphere including Canada. Most competing brands to Sears Canada have an online presence. Sears should also enter the online marketing platform by liaising with home delivery companies.

Employees are the main link to the customer. Their interaction with customers affects customer loyalty. Well-trained employee provide better services to customers (Hill & Alexander, 2017). Good employees lead to customer satisfaction and loyalty. Training employees will encourage the consumers to visit the Sears store looking for better deals and good advice from experienced employees. The other option is to improve the store facilities to increase the efficiency of the customers. One improvement is to improve the information system of the retail stores. An improved information system will help identify the goods that customers purchase to help order them. Information systems also analyze the sales trends to help the company to stock appropriately. Appropriate stocking helps increase sells by providing customers with products they desire.

Work and Timeline

After the approval of this proposal, the work will start by January 2019 until September 2019 and will be in four phases, each phase or stage will concentrate on one of the mentioned problems. The overlap between the phases will reduce the time of the proposal, update and feedback are essential to do the correction acts. The stages are mentioned in the table below.

Cost

1. Training for store employees ( consumers satisfaction )

In-house training cost: $ 500,000

2. Upgrade or maintenance for stores 830 : $ 5 M

3. Updated the rewards program and software application: $ 100,000

Total cost: $ 5,600,000

Conclusion

The main objective of this proposal is to update retail stores with required commodities to improve the sales and services provided to consumers. The importance of training employees to get the consumers satisfaction and high productivity. Improve the rewards program to encourage customers to pay more. Lack of these measures will decrease of all profit and market share. It is mandatory to take some action to resolve these issues

Sears Canada should stop liquidating its outlets and focus on improving its revenues. The company has a strong brand name and infrastructure across the country. It can increase its market share by incorporating through store improvement and the installation of a predictive information system. Sears should also train its employees and introduce a simple rewards scheme to its customers. In essence, Sears should attempt to attract more customers through its employees, products, and services. The company can remain competitive and solve its financial troubles outside the liquidation process.

References

Business insider (2017, January 8). Inside Sears' death spiral: How an iconic American brand has been driven to the edge of bankruptcy. Retrieved from https://www.businessinsider.com/sears-failing-stores-closing-edward-lampert-bankruptcy-chances-2017-1.

Global news (2017, October 11) Sears Canada: The rise and fall of the department store empire.Retrieved from https://globalnews.ca/news/3796409/sears-Canada-history/

Hill, N., & Alexander, J. (2017). The handbook of customer satisfaction and loyalty measurement. Routledge.

Kumar, V., & Reinartz, W. (2018). Loyalty Programs: Design and Effectiveness. In Customer Relationship Management (pp. 179-205). Springer, Berlin, Heidelberg.

McKenzie, B., Burt, S., & Dukeov, I. (2018). Introduction to the special issue: technology in retailing. Baltic Journal of Management, 13(2), 146-151.

Sears Canada. (2017, April) Sears Canada Annual Report 2016. Retrieved from http://www.annualreports.com/HostedData/AnnualReports/PDF/TSX_SEARF_2016.pdf