BENTON HARBOR — Whirlpool Corp. officials aren’t worried about any fallout from Sears filing for Chapter 11 bankruptcy Monday.
In reaction to the retailer’s bankruptcy – which came after years of decreasing sales and mounting debt – Whirlpool released a statement Monday that Sears Holdings Corp.’s decision to cut its losses will have a “limited impact” on Whirlpool’s operations.
As of Sept. 30, about $30 million – or 1 percent – of Whirlpool’s aggregate accounts receivable exposure was related to Sears. In addition, net sales to Sears represented less than 2 percent of the Benton Harbor appliance maker’s global net sales.
The timing of the bankruptcy comes nearly a year after Sears stopped selling Whirlpool appliances in its stores and online.
Sears began selling washing machines made by the Upton Machine Co., which later became Whirlpool Corp., in 1916. The agreement marked a turning point for Whirlpool in its early years.
In October 2017, Sears said it would sell Whirlpool appliances in its retail stores until inventories were gone.
A Sears memo cited by The Wall Street Journal stated the decision was due to pricing disagreements with Whirlpool. However, there were conflicting reports that Whirlpool was concerned with Sears’ ability to pay for products.
Despite the end of the 100-year-old partnership, Reuters reported Whirlpool would continue to supply several of its products to Sears – including Kenmore brands – and discontinue the supply of brands like Maytag refrigerators, KitchenAid products and Jenn-Air appliances.
“Our products are sold where consumers want to shop with distribution across all big-box retailers, the homebuilding channel and independent retailers,” Joe Liotine, president off Whirlpool’s North America region, said in a news release Monday. “We will continue to provide a great array of product offerings and services that meet consumer needs, offering strong brands that deliver innovation to consumers every day.”
Liotine said Whirlpool does not anticipate the Sears bankruptcy will have any impact on the company’s full-year 2018 guidance or financial results over the long term. The appliance company is expected to release third quarter earning results later this month.
Sears in Southwest Michigan
As part of the bankruptcy decision, Sears announced another 142 store closings, on top of the 46 closings that were announced in August.
Liquidation sales at the additional stores are expected to begin within two weeks, according to a court filing.
“As we look toward the holiday season, Sears and Kmart stores remain open for business and our dedicated associates look forward to serving our members and customers,” Sears Chairman and CEO Eddie Lampert said in a news release. Lampert has since announced he is resigning as CEO.
The company has 687 stores remaining – a number that includes Kmart locations.
The Sears Hometown Store in Dowagiac is expected to remain open, as only four Michigan locations – two Kmart stores in North Charlevoix and Lake Orion, plus two Sears locations in Ann Arbor and Lincoln Park – are among the stores to be shuttered.
The last time the retailer had a presence in the Twin Cities was after the Sears Hometown Store opened in 2012 at The Orchards Mall in Benton Township. It was located in the former FYE Music Store across from the mall food court.
However, the store lasted only five years, closing in the summer of 2017.
Sears had been an anchor store at Orchards Mall for 30 years. The full-service Sears store opened in the mall in 1979, but ended up closing down in 2009.
For much of its 132-year history, Sears was at the forefront of American retail. The company has lost money for years and it has several thousand fewer stores than it did in 2008, when the Great Recession hit brick-and-mortar stores hard.
Contact: twittkowski@TheHP.com, 932-0358, Twitter: @TonyWittkowski