CEO’s Plan to Save Sears Would Hand His Hedge Fund $1B
Eddie Lampert&#x27;s mismanagement of Sears is the <i>reducto ad absurdum</i> of financial &quot;wizards&quot; attempting to succeed as business operators.<p>I will never forget reading this article (from 2011): <a href="https:&#x2F;&#x2F;www.wsj.com&#x2F;articles&#x2F;SB10001424052970204517204577042442598865710" rel="nofollow">https:&#x2F;&#x2F;www.wsj.com&#x2F;articles&#x2F;SB10001424052970204517204577042...</a>.<p>&#x27;While retail experts estimate that store chains traditionally spend $6 to $8 per square foot on annual maintenance, Sears is spending a fraction of that amount, said Matthew McGinley, managing director of International Strategy &amp; Investment Group, an investor research firm.<p>&quot;With roughly 250 million square feet domestically, [Sears] is spending about $1.90 a foot, which is a quarter of what you need to maintain share and keep it as an acceptable place to shop,&quot; Mr. McGinley said.&#x27;<p>---<p>Nor will I forget reading about his management philosophy where different Sears departments have to compete for money in the budget. Money to advertise, to purchase inventory, etc. (<a href="https:&#x2F;&#x2F;www.bloomberg.com&#x2F;news&#x2F;articles&#x2F;2013-07-11&#x2F;at-sears-eddie-lamperts-warring-divisions-model-adds-to-the-troubles" rel="nofollow">https:&#x2F;&#x2F;www.bloomberg.com&#x2F;news&#x2F;articles&#x2F;2013-07-11&#x2F;at-sears-...</a>)<p>To the average &quot;person on the street&quot;, it may be patently obvious that when your stores are filthy and understaffed, no one will want to shop there. To Eddie Lampert, the way to juice EBITDA for a few years is to slash that maintenance money.<p>Pour one out for the death of multiple iconic American brands (Craftsman, Kenmore, and eventually Sears itself). Don&#x27;t shed a tear for Lampert, since he&#x27;s set himself up for a &quot;heads, investors, customers, and employees lose&quot; and &quot;tails, I win&quot; situation.