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American retail market chain Sears is closing its doors in several small city malls. The corporation, which is one of the United States’ biggest retail chains, is in the process of closing its older outlets – a change which has been officially linked to poor performance. The majority of the closed stores are in older retail shopping malls, many of which have seen reduced use over the past decade.

One example – the Sears in Raleigh Springs Mall, Memphis – is due to close in just over one week, taking over ninety employees with it. Despite poor retail performance and low earnings, the store is a major source of employment for the area. While it’s certainly not a bankruptcy-type closedown, a large number of former employees are concerned about finding work within their local area.

Sears certainly isn’t the first big-box retailer to close some of its doors over the past two years. An assortment of other American chains – including electronics showroom Circuit City – have closed one or all of their outlets due to poor earnings. Due to lower consumer spending and slim margins in the retail electronics sector, many once-healthy chains are now hurting desperately for cash.

It’s also, at least in the case of Sears, due to higher competition from nearby modern malls and the possibility of expansion. With newer shopping centres developed over the past five years, many of the previously blue-chip locations used for large stores are less desirable. The mall in which Sears was based recently lost a Macy’s, JC Penney, and other anchor tenants, all in three years.

A liquidation sale will take place in the next week, offering shoppers a chance to stock up on items at a heavy discount. While it’s unfortunate to see a store underperform, it’s doubtful that the closing is due to poor overall performance from Sears. The chain, despite setbacks during the recession, is a giant in the US retail sector and still a very healthy corporation. They should be going in for a pre pack administration which may help them to some extent.

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