Innovation/Entrepreneurial Change Annotated Bibliography

Running head: INNOVATION/ENTREPRENEURIAL MISHAPS

INNOVATION/ENTREPRENEURIAL MISHAPS

Innovation/Entrepreneurial Mishaps

Sears and Staples are well-known businesses that are closing stores and announcing significant layoffs for employees. Sears and Staples are on the verge of closing down stores due to bigger, innovative, and competitive retailers. As these stores continue to be taken over by competitive marketing strategies and catchy slogans, is it even possible to save a sinking ship? This paper illustrates missed opportunities for innovation and creativity that could save these retailers.

Sears

Sears has nearly closed half of their stores due to a lack of sales in the retail industry.

In 2005 Kmart merged with Sears, and this merger did not profit either establishment but only proved to be a disaster. Loeb (2016), "In 2005 Edward S. Lampert merged Sears and Kmart into Sears Holding. Ed Lampert is the founder and chairman of ESL Investment, a Connecticut-based private hedge fund" (para. 4). Kmart’s sales had lacked before the merger and Sears missed an opportunity to evolve with technology while stores like Walmart, Costco, Sam’s Club, The Home Depot, and Lowes are booming in sales and profits. There are a few approaches Sears could use to bring their company back on the grid. First; reasonable prices, 2nd; Convenient locations, 3rd; find out what the customers want and need, 4th; clean the stores up and make them more inviting for customers. Consumers want to shop in clean, organized, and friendly stores. Customers are always looking for variety and a good deal.

Patrons can always get great deals when buying from retailers that have products made from overseas, and the competition is stiff. Snyder (2016), "Sears Chairman Eddie Lampert released a letter to shareholders filled with all kinds of bad news. In this letter, he blamed the horrible results that Sears has been experiencing lately on “tectonic shifts” in consumer spending” (para. 2). Sears can turn this around just by finding the right person that is willing to take on the challenges entailed with the collapsing merger.

Staples

Staples’s biggest competitor is Amazon.com, and they are not backing away from the fight. As a matter of fact, the Chief Information Officer (CIO), Tom Conophy, has declared that they are willing to go after Amazon on their platform. As the self-proclaimed original disruptors in retail, who has lost their way, did not see the Amazon machine coming, but has pledged to take the fight to Amazon. Staples is trying to increase its market share by enhancing its on-line functions and incorporating competitive pricing. “In more general terms, Conophy described the kind of innovative, forward-thinking IT approach he feels necessary for survival in today's retail environment,” (Berthiaume, 2016).

Staples plans on closing 12 percent of their stores, equivalent to 225 establishments and saving the company $500 million dollars. They are planning to reinvest in the e-commerce and innovation departments of the company. Staples in-store sales have dropped seven percent, but their on-line sales have grown by ten percent. Staples plans to reinvent its brand and prove that they are more than a paper and printer store. With a new slogan like, "Make More Happen," Staples plans to be more like Walmart and Amazon selling everything customers want and need. They will sell more than just paper and pencils, and have prices that are competitive in-store and on-line.

Conclusion

As the middle-class society continues to decrease and spending follows with a downturn in this new economic day in age, smaller communities are finding it harder to support their local retailers and are turning to the bigger retailer that can provide their families with lower costs and better products. Sears and Staples can recover from this meltdown by taking the time out to see what people want and what they have to say about their stores. Use technology for advancement and resourcefulness. There are some loyal consumers still out there waiting for these stores to make that change and never forget why the company first went into business. Consumers need to know that the stores they are shopping at are stores they can trust.

References

Berthiaume, D. (2016). Chain Store Age. Retrieved from

http://www.chainstoreage.com/article/staples-aims-amazon-innovative-efficient-data- driven-it#

Hisrich, R.D., & Kearney, C. (2014). Managing innovation and entrepreneurship. Los Angeles,

CA: Sage

Loeb, W. (2016). Sears Holding (SHLD) - An Opportunity Missed - A Tragedy in the Making. Retrieved from http://www.forbes.com/sites/oracle/2016/09/08/move-over- mobile-ai-has-arrived/#1a8a8a2c5be0

Snyder, M. (2016). Economic Recovery? 13 of the Biggest Retailers in America are Closing Down. Retrieved from http://theeconomiccollapseblog.com/archives/economic-recovery- 13-of-the-biggest-retailers-in-america-are-closing-down-stores