SEARS IS STILL “FIGHTING LIKE HELL” TO MAKE THE COMPANY A RETAIL...

1—STRAIGHT TALK Winter 2018—

Volume 20, Issue 2 Winter, 2018

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SEARS IS STILL “FIGHTING LIKE HELL” TO MAKE THE COMPANY A RETAIL SUCCESS

This past year has been a struggle for most “brick and mortar” retailers—and Sears Holdings was certainly one of the many retailers affected by the change in the shopping habits of consumers.

Chairman Edward Lampert said at the May 11 Sears An-nual Meeting:

“Our Board, man-a g e m e n t t e a m and th e ten s of thousands of as-soc iates working at Sears Holdings unders tand that performance mat-ters, and we remain committed to pow-e r i n g t h r o u g h these challenges.”

Over the years, and more specifically this past year, there has been con-stant negative commentary about the future of Sears. In fact, one very recent article by Jesse Cash in Seek-ing Alpha, said that Sears Holdings is in a death spiral; the company is selling off desirable assets, which will speed up their demise; and financials have been and will continue to be horrible. The article was headlined: “The Reports of Sears’ Death Are NOT Greatly Exaggerated.”

In this same article, Mr. Cash said that CEO Lampert has attempted to save the company by selling off every-

thing that made the company loved. And according to the Harvard Business Review, “Some of the company’s moves in recent years have generated cash and kept the business afloat at the long-term expense of its brand.”

Lampert’s Response

At this year’s Sears Annual Meet ing, Lampert addressed the issue of negativity in the press and said that he is not asking to be spared from informed opinions about Sears busi-ness performance, but for far too long, many commentators have rushed to con-clusions about the future of the company.

“Not only have these predictions been off the mark and based on incom-plete and selective information or bi-ased sources, but they have been harmful,” Lam-pert said.

This issue of STRAIGHT TALK:Sears Fighting Like Hell p. 1

Medigap Plan F Ending p. 4

George O’Hare Obituary p. 5

N.A.R.S.E. 20th Anniversary p. 6

Medicare Card Changes p. 8

Chairman’s Page p. 9

What Sears Does Best p. 10

Return of Wish Book p 12


“We have spent a lot of time educating many external stakeholders—we need each other for success—and while it hasn’t been easy, we are still here and fighting hard,” he added.

In last winter’s issue of Straight Talk there was an article titled: “Will There Be Another Christmas at Sears.” This article, from the MotleyFool, concluded by prophesizing “The day is fast approaching and the loss of vendors may be the herald that this may be the very last Christmas for Sears Holdings.”

Be that as it may, Christmas 2017 is just around the corner, and Sears is still in business for this holiday season. Analysts say Sears still has assets to sell to keep it afloat. And as long as it continues to pay on time, suppliers are unlikely to abandon the company. Many say they want Sears to stay in business but have taken the harder position on payment terms to pro-tect themselves.

Sears has been selling real estate and brands to raise cash, and Mr. Lampert has pumped in money through short-term loans from his hedge fund.

This past October, Lam-pert’s hedge fund, ESL Investments Inc., lent Sears another $140 million, bringing its total borrowing from ESL to roughly $1.6 billion. In a May 2017 blog, Lampert wrote: “People have often asked me why I am still committed to the company in its ‘transformation.’ The answer is that I firmly believe we will succeed.”

Sears Holdings has lost more than $10.4 billion since 2011. Annual sales over that period have collapsed to $22.14 billion from $41.57 billion as the company has spun off divisions, closed hundreds of stores and attracted fewer shoppers to its 1,250 remaining Sears and Kmart locations.

Recent Wall Street Journal Article

In a November 1, 2017, article in The Wall Street Jour-nal by Suzanne Kapner, she outlined the worsening troubles at Sears and its suppliers’ turmoil. Ms. Kap-ner said that this “turmoil is the sharpest sign yet of Sears’s decline.”

As an example, the months-long feud between Sears and Whirlpool burst into the open in October when the sides could not agree on terms to keep their century-old partnership going. Earlier in 2017, Sears sued two longtime manufacturers of its Craftsman tools to keep them shipping merchandise to stores.

It was also reported that to guarantee shipments from LG Electronics Inc. and Samsung Electronics Co., Sears is paying them cash up front for some goods, said people familiar with the matter.

Levi Strauss & Co. has stopped supplying women’s jeans to the company, said another person. And, at Clorox Co., “We have certainly adjusted our payment terms,” said CEO Benno Dorer.

“We cut their credit line and shortened payment terms,” said Isaac Larian, chief executive of toy maker MGA Entertainment Inc. “If they pay one day late, we

will cut them off.”

Media Target

It’s not the first time Sears has said that it’s been tar-geted by the media. Earlier this year, at the company’s annual meeting, Chair-man Lampert showcased a decade’s worth of headlines about the company that predicted its imminent de-mise yet noted that Sears is still standing.

Last year, Lampert used his chairman’s letter to share-holders to hit back at critics, saying new-economy companies are held to a different standard than legacy retailers like Sears. Uber at the time was praised for raising $10 billion in capital, even though it lost $1 billion in China, while Tesla was held up as a marvel despite being propped up by taxpayer subsidies.

In part, he acknowledged it’s the older business model that’s really under attack and needs to change, which he said is something he’s trying to do but gets little or no credit for. In May 2017, he maintained that the negative coverage has been “deliberately unfair” and “meant to scare our vendors.”

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Like Hell continued from page 1


Sears Responds

Sears used its company blog to rebut some of the state-ments in the November 1 Wall Street Journal article that claimed many vendors were refusing to send products to Sears and Kmart, calling the story “yet another rehash of inaccurate assertions and negative speculation about Sears Holdings and its future. We continue to have strong relationships with over 50,000 vendors and suppliers.”

This article quoted Sears spokesman, Chris Braith-waite as saying that the company has taken a number of steps “to remain a viable competitor,” including clos-ing unprofitable stores, negotiating “with vendors to reduce their risk in doing business with us,” and “invest-ing in its customer-loyalty program and reducing costs.”

Braithwaite added “inaccurate assertions and negative speculation about Sears and its future have had a very detrimental impact on the company through mere repetition.”

On Sears website, the com-pany specifically addressed a number of the assertions made in the Journal article:

(1) In relation to Whirl-pool, we were unable to reach an agreement that would have allowed us to offer Whirlpool products to our members at a reasonable price. As a top seller of large appliances in the U.S., Sears Holdings will continue to carry a wide range of products from our own award-winning Kenmore brand, as well as products from LG, Sam-sung, GE, Frigidaire, Electrolux and Bosch.

(2) We have a long-term relationship with LG and con-tinue to do significant volumes of business under mutually agreed terms. It is common for vendors to offer incentives to retailers for earlier payments. Though unreported, LG specifically told the Wall Street Journal reporter “LG greatly values our rela-tionship with Sears, and is absolutely committed to our strategic partnership long into the future.” Sears responded, “This is a sentiment we share.”

(3) The Wall Street Journal also highlighted that “Levi’s has stopped supplying women’s jeans to Sears,” but

failed to mention that we still carry their men’s and kids’ jeans and continue to have a great rela-tionship with Levi’s. Incidentally, Sears said that they stopped carrying Levi’s jeans women’s a few years ago.

(4) In a recent conversation with a senior SHC execu-tive, the CEO of MGA Entertainment, Isaac Larian, reiterated that MGA has been shipping the hottest toy in the market (L.O.L. Surprise!) to Kmart and will continue to do so—including additional quanti-ties we had already requested.

Chairman Lampert said “We will continue to work hard to make our company successful and continue to serve the needs of our millions of members.”

The Buck Stops Here

As one financial analyst said, it was Lampert’s deci-sion to forgo investing in remodeling his stores because

he didn’t think custom-ers cared about décor. He chose to use financial gym-nastics like interest-rate swaps instead of modern-izing to make quarterly sales numbers. And while Lampert’s Shop Your Way loyalty program has a few innovative features to it, it’s not a novel idea, as membership programs are now commonplace.

As reported by Rich Duprey in the November 13, 2017, Seeking Alpha article, the poet Carl Sandberg once wrote: “If the facts are against you, argue the law. If the law is against you, argue the facts. If the law and the facts are against you, pound the table and yell like hell.”

Not all reporting on Sears Holdings has been fair or accurate, but the company just announced it is closing another 63 stores, and Standard & Poor’s downgraded its debt deeper into distressed territory. How can the media not report on such developments?

And Lampert’s complaining about negative coverage is akin to him pounding on the table in an attempt to distract from where the real problem lies.

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MEDIGAP PLAN F IS ENDING WHAT DOES THIS MEAN FOR YOU?

Medicare Supplement Plan F is one of the most popu-lar supplement plans on the market, and has been for decades. Seniors looking to avoid out-of-pocket costs, including the Part B deductible and excess charges often turn to Plan F for benefits on day one.

But if Plan F is so popular, why is it being phased out in 2020? Here’s some back-ground information on what’s going on with Medigap and what you should know to make an informed decision.

As a result of the Medicare Ac-cess and CHIP Reauthorization Act of 2015 (MACRA)—a fancy name for a law that changes the way Medicare doctors are reimbursed—Congress is elimi-nating Medigap plans that cover the Part B deductible, like Plan F. This was a bipartisan effort. Plan F will no longer be avail-able for new recipients starting January 1, 2020.

The Good NewsIf you already have a Plan F, you can keep it and will not be forced to move to another plan. You will be “grandfathered,” and can keep your plan for as long as you like. MACRA is directed at new enrollees only.

The Bad NewsThe Plan F premium rates will be increasing at a higher rate than the other plans that are not impacted. Why is this? Each plan is individually rated based on the claims processed for that particular plan.

So, after 2020, when Plan F is no longer accepting new applicants, the pool of Plan F members will begin to age more so than the pool of other plan members, which will drive higher proportionate claims cost and thus drive up the premiums for Plan F. In other words, existing Plan F recipients will be getting older and sicker and filing more claims.

Why Is Congress Doing This?

Plan F is referred to as “first dollar” coverage because it covers the annual Medicare Part B deductible. This

benefit allows policyholders to get non-emergency med-ical care without having to pay an annual deductible.

Medigap Plan F is the Cadillac of all medical supplement plans. It essentially gives the policyholder 100 percent coverage. Medicare covers 80 percent of the outpatient benefits, and Plan F covers the Part A and B deductibles

as well as the other 20 percent.

People with Plan F have no copays for Medicare-covered services whatsoever—not even a copay at the doctor. Congress felt that this has caused abuse in the system.

Congress feared that Plan F pol-icyholders visit their healthcare providers more often than people who pay their own deductibles. They worry that anyone with Part B deductible coverage will run to the doctor for every sneeze and paper cut. Converse-ly, if you were responsible for

paying your own deductible, then you might think twice about visiting your doctor for minor things like a cold.

What the Critics SayCritics say that eliminating Plan F might cause some people to forego care, resulting in more expensive care later on, costing Medicare more in the end. There could be health conditions that don’t get diagnosed early enough and end up costing Medicare big bucks down the road.

While that may be true, it didn’t prevent Congress from eliminating Plan F with first dollar coverage. They want you to have a little “skin in the game.”

What Can You Do?If you are currently enrolled in Plan F and want to switch carriers before 2020, you should switch as soon as possible to lock in the current rates. Insurance car-riers will probably increase premiums in the future.

In addition, Plan F holders may want to make sure Plan F is the right plan for them and make changes

WHAT HAS

CONGRESS

DONE?!

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while they are healthy and still able to qualify for a different plan which requires medical underwriting.

You might want to consider enrolling in Plan G, which functions exactly the same as Plan F except that you pay the small annual Part B deductible, which in 2018 is $183.00. This is still great coverage, and you won’t find yourself stuck in an obsolete Medigap plan that will have escalating costs over time.

Choosing the Best Medigap Insurance CompanyWhether you are switching to a new insurance carrier or enrolling for the first time, it is important to buy a Medigap plan from a stable and trusted insurance company. Remember—the only differences between one insurance company’s plans and another insurance company’s plans are the price and the company itself.

It is recommended that you choose an insurance com-pany with an A+ rating from rating companies such as A.M. Best Company and the Better Business Bureau. A+ rated companies have the ability to not only pay their claims but they have the financial stability to have stable rates.

Lower rated carriers or new insurance carriers may offer lower premiums initially, but they could increase premiums drastically from year to year or after the introductory rates are over.

ConclusionWhile Medigap plans with deductibles are going away, enrollees with this coverage will be grandfathered. If first dollar coverage is important to you, stay with Plan F. However, if you can handle a small Part B de-ductible, options such as a Plan G offer significantly lower premiums today and will be around after 2020.

If you are healthy, it is important that you act now since you will have to go through medical underwriting in or-der to switch your Medicare supplement plan. If you wait until a later point, you risk potential health issues that could prevent you from changing your supplement plan.

Selecting the right coverage now can help you attain rate stability down the road. Because of the complexity of this issue, you may want to contact a licensed insur-ance broker, who represents a multitude of insurance carriers, to assist you in selecting an affordable plan that gives you peace of mind knowing you are covered.

Medigap continued from page 4

George O’Hare passed away November 14, 2017, at the age of 90. He was a founding member of N.A.R.S.E. and participated in many of the organization’s pro-tests and rallies.

In 2005, George arranged to have a plane fly over Sears Headquar-ters in Hoffman Estates, Illinois, during its annual meeting when the Board was voting on the

merger of Kmart and Sears. The plane flew a banner proclaiming, “Sears Unfair to Retirees.”

At N.A.R.S.E.’s 10th Annual Meeting that was held in Atlanta, Georgia, he arranged to have Dick Gregory, stand-up come-dian and social satirist, be the luncheon speaker. And for many years, George was the N.A.R.S.E. communications contact with the press.

George was also a civil rights activist who counted among his friends comedian Dick Gregory; Rev. Jessie Jackson, Sr.; and Rev. George Clements, the first catholic priest in Chicago to adopt a child. Rev. Clements was the celebrant at George’s Mass of Christian Burial on Saturday, November 18.

George was an excellent speaker and formed his own motivational

f irm. He always dressed in a Sears’ blue suit with a red tie and had a copy of the U.S.A. Constitu-tion in his pocket.

His last position at Sears was as a merchandise manager at the Oak-brook, Illinois, store. And during his final days at the company he was appointed as the group liai-son with the black community.

He is the co-author of Confes-sions of a Recovering Racist that will be published soon. One of his friends said, “George made his contribution to society and has left behind a great legacy.” Another friend who worked with him at Sears said, “He was one-of-a-kind dedicated individual. He is now reunited with his wife in eternal life.”

George has three adult sons and 11 grandchildren.


THE 20th ANNIVERSARY OF N.A.R.S.E.

Durham, North Carolina Sears Retiree Club—2010

Sears Syracuse Central New York Retiree Club—2008

Memphis, Tennessee Sears Retiree Club—2014 Fayetteville, North Carolina Sears Retiree Club—2007

Charleston West Virginia Sears Retiree Club – 2007


“The Big Ticket” Luncheon in Elmhurst, Illinois on December 28, 1998

Sears Best Retiree Club, Evansville, Indiana—2015

Sears Atlanta Retiree Club (The Big Club)—2007

Central Texas Retirees Club—2007

Retired Atlanta Area Controllers Club—2007Tucker, Georgia Girls Retiree Club—2007

The White Marsh Diehards Retiree Club, Fallston, Maryland—2009


MAJOR MEDICARE CARD CHANGES FOR 2018There are some major Medicare changes beginning in 2018 that will impact everyone on Medicare. “Everyone” is approximately 57 mil-lion people!

As background, a law was passed in 2015 called the Medicare Access and CHIP Reauthorization Act (MACRA). This law is also known as the Social Secu-rity Number R e m o v a l Init iat ive (SSNRI), and mandates the removal of So-cial Security Numbers from Medicare cards.

The purpose of this law is to help protect Medicare recipients from medical identity theft. Under this law, all Social Security Numbers will be removed from all Medicare ID cards by April 2019.

A new Medicare Beneficiary Identi-fier (MBI) will replace the current Social Security Number on the new Medicare cards. The MBI will be unique for each individual and have the same number of characters as the current Social Security Number.

Why Is the Removal of the Social Security Number Important?The goal of the law is to decrease Medicare beneficiaries’ vulnerabil-ity to identity theft. By replacing your Social Security Number from all Medicare cards, your private health care and financial informa-tion will be better protected.

Removing Social Security Numbers might not prevent a healthcare data breach from occurring, but should Medicare beneficiaries lose their

Medicare cards, it will ensure that Social Security Numbers will not easily fall into unauthorized hands.

Date of Issuance for the New Medicare CardsBeginning in April 2018 and no later than April 2019, the new Medi-care cards with the new Medicare

Beneficiary Identifier num-ber will be mailed out. The MBI number will replace the current Social Secu-rity Number now on the Medicare cards.

The MBI number is conf idential so re-

cipients should be careful with it. The MBI number will be a random 11-digit number consisting of alphanumeric characters.

Transition PeriodThe Transition period for the change of the Social Security number on the Medicare cards to the new MBI number will begin April 1, 2018, and run through December 31, 2019. During this period, all medi-cal providers, hospitals, ancillaries, physicians, suppliers, etc., can use either the older Social Security Number or the newer MBT num-bers. But, beginning on January 1, 2020, only the new MBI number can be used.

Guard Your Social Security and MBI NumbersFor security reasons, do not carry your Medicare card in your wallet or purse unless you are going to a new doctor or health professional and need to show it to them on your first visit.

Social Security Numbers, and in the near future, MBI numbers, are wrapped up in most aspects

of American lives—employment, medical histories, taxes, education, bank accounts and so on.

The risk of having your identity stolen is real. Every two seconds someone’s identity is stolen! In 2016, 15.4 million consumers ex-perienced identity fraud costing Americans $16 billion.

If someone else finds your numbers, here are a few destructive things they can do with them:

1. Open financial accounts and obtain credit cards and loans without paying them back im-pacting your credit rating.

2. Get medical care tainting your medical records.

3. File for a fraudulent tax refund delaying any refund you are rightfully owed.

4. Commit crimes and the thief then gives your Social Security Number to law enforcement.

5. Steal your benefits by filing for unemployment or Social Secu-rity benefits.

6. Steal from your 401(k) account.

7. Ta ke mone y out o f y ou r bank account.

8. Rent or buy properties.

Watch out for Scams!You may receive government impos-ter calls about your new Medicare card. Do not give these imposters any personal information or your Social Security Number or your new MBI number. A real govern-ment representative will never call you asking for such information.


Ron Olbrysh, N.A.R.S.E. Chairman

Chairman’s Page

STRAIGHT TALK 20th ANNIVERSARY MEMORIESOn an anniversary two de-cades in the making, this is an opportunity to look back at some of the articles published in Straight Talk. Regarding Sears, do you re-member some of these?

Back in the Spring of 2007 we published, “Should I Stay, Cancel or Suspend? High Cost of Medical Coverage for Retirees Using Retiree Health Access.” And then in

the Spring of 2009, to keep up with the change in consumer shopping habits, there was “SHC Looks to Online Shopping for Future Growth.”

Over the years, to reflect what the financial analysts were reporting about Sears, we published the fol-lowing articles: “Is Sears Holdings a ‘Fatally Wounded Company’?” (Winter 2012); “Is Sears in Rocky Territory? Chairman Lampert says: ‘We’ve Got a Lot of Work to Do.’ ” (Sum-mer 2013); “Can Sears Survive in the Current Retail Environment?” (Win-ter 2014); “Is Sears Holdings in a Turnaround or Liquida-tion Mode?” (Summer 2015).

With all of the negative news about Sears Holdings, in the Summer of 2017, we suggested “Sears Can Survive If … ” In the same issue, we had a com-panion piece stating “Sears Future May Be in Doubt, but Its Past Was Very Impressive.”

While there were many articles about Sears, we have also kept our retirees up-to-date, as in this current issue, about mat-ters at the federal level that could have a significant impact upon them. Again, do you remember?

“Managing Your Health Care Costs” (Winter 2006); “The Country’s Medical System is Broke” (Fall 2007); “Protect Your Social Security and Medicare Benefits” (Summer 2008); “Is Congress Responsible for Creating Social Insecurity?” (Spring 2009); and “The Pros and Cons of Obamacare” (Winter 2009).

Meeting in AtlantaAnd then, at N.A.R.S.E.’s 10th Annual Meeting in Atlanta, Georgia, our luncheon speaker was Dick Gregory, stand-up comedian, social satirist, author, etc., who entertained the retirees for over an hour. He asked the luncheon guests what did Martin Luther King and N.A.R.S.E. have in common?

Gregory said that Martin Luther King did not get killed because of integration, or racism or sexism. He got killed because he became the first black person in the history of America to get in a position to determine public policy.

The reason Gregory brought this fact up was because: “10 years ago you all got together (Sears retirees) to put yourselves in the position to determine public policy … One of the things you need to do is spend some time looking at that black movement

… looking at the women’s movement” to see how they accomplished their goals.

Gregory concluded his presen-tation by thanking the Atlanta retirees and told them to “Keep up what you are doing. And let everybody know what you are doing. Let everybody know there are some people out here that will not tolerate” what is being done to retirees.

Dick Gregory died August 19, 2017 of heart failure at the age of 84 in Washington, D.C.

George O’Hare, Dick Gregory, Ron Olbrysh, and Bob Romasco, keynote speaker at N.A.R.S.E.’s 10th Annual Meeting and member of AARP’s Board of Directors.

Dick Gregory sharing his wit & wisdom at luncheon.


THE KCD LABORATORY— DOING WHAT SEARS DOES BEST

They used to be the “Big Stores”—Sears & Roebuck, J.C. Penney, Marshall Field’s—those familiar merchandisers with decades of his-tory serving the wants and needs of generations of families. Now, what they do is no longer good enough in a marketing climate focused on meeting the demands of customers who want to drive up—not walk in, who want to go online—not stand in line, who want to look at a pic-ture—not look at a product.

Nearly every day, newspapers, tele-vision and the Internet announce the impeding demise of the big retailers—pick any name. Store closings, brand sell-offs, financial losses, rising debt, Internet incur-sion all threaten those brick and mortar stores that anchor shopping centers and malls everywhere. But who or what is responsible for this retail crisis is not the issue here. Nor are the solutions.

What is important is that while technology is a major factor threat-ening the big stores in the area of product purchase and delivery, the 126-year-old Sears, Roebuck and Company continues, amid all the turmoil, to provide the best, most reliable, cost-effective products to its customers—with the latest tech-nology. And they have been doing this for past 106 years thanks to the Sears Laboratory.

The lab was established in 1911 in response to the enactment of the Pure Food and Drug Act, ac-cording to Gordon L. Weil, in his 1977 book, Sears, Roebuck, U.S.A. The Great American Catalog Store and How It Grew. Weil states, “Al-though all Sears products covered

by the act conformed to its require-ments, the company wanted to bring the entire catalog into line with the spirit of the new law... and the lab soon came to be known as ‘the watchdog of the catalog.’ ”

Because the company was such a large purchaser of other people’s products, it could demand that the goods be made to its specifica-tions and those of its customers.

That first labora-tory took up more t ha n 125,0 0 0 square feet of the company ’s headquarters on Homan Avenue in Chicago and c e r t a i n l y was an anomaly for a merchandis-er. According to Weil’s book, the laborator y d id not always have smooth sai l ing for many years due to internal conf licts as to its real value in the marketplace.

Finally, Chairman and CEO Ar-thur M. Wood (1973–78) made pleasing the Sears’ customer his goal and supported the development of a unique corporate laboratory known simply as Department 817.

Wood, according to Weil increased the staff of the lab and gradually de-fined its functions, which included:

• spot-check testing of claims before items were advertised to

keep suppliers to the specifica-tions outlined in their contracts;

• testing of items before being se-lected for inclusion in the Sears lines by evaluating what was already in market; and

• determining all facts about items sold by Sears, in short, to know

what the company was selling and making sure claims were accurate.

Wood would certainly be pleased with how the old Department 817 has morphed into today’s Kenmore, Craftsman, DieHard (KCD) Prod-uct Development Laboratory and a proud team of engineers, designers and technicians who stand behind their company and its products.

Heading up the lab are Tom De-Salvo, division vice president with

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Coldspot Refrigerator, 1947


Kenmore Product Development, a mechanical engineer, and Mike Sau-bert, director of industrial design, Kenmore Appliances, both laborato-ry employees for more than 20 years.

Through development, testing and brand comparison, the team working alongside the duo is responsible for enhancing the KCD product line from ideas on the drawing board to the safe arrival of the packaged product in the home.

So here’s where Sears makes the most of today’s technology to meet the needs and desires of a whole new generation of consumers. In its 30,000-square-foot laboratory at

the Sears Holdings Headquarters in Hoffman Estates, old meets new. You’ll find an iconic, slightly yellowed Coldspot refrigerator from 1947, the darling of your grandparents, and for the millennials of today, a sleek, shiny black model with a window that illu-minates to show the contents inside.

And that is just the start. A tour of the laboratory starts with Con-nected Lab, where software teams design programs so you can log in to your Kenmore appliances remotely from any of the Amazon Echo products (Echo, Echo Dot, Echo Plus, Echo Spot, Echo Show). “And soon,” says Tom DeSalvo, “all new products will be connected.”

While there is the simple conve-nience of being able to start your washing machine and have it ready for the dryer when you return home, there is also a safety factor. Say you are away from home and you receive a message that the sensor on your water heater detects a leak, you

have that peace of mind that you are able to react in such a situation.

Aside f rom an e m e r g e n c y , connected ap -pliances enable you to streamline your service calls. Says De Salvo, “The technician has all the data on the product, like a refr igera-tor with 122 data points. They can diagnose a prob-lem, determine if a part is needed, order the par t, and then make one house cal l

instead of two.” One-third of ser-vice calls, he added, just require customer instruction, and can be solved over the phone.

The tour moves on to areas dedi-cated to kitchen and laundry products—ovens, microwaves, washing machines, dryers, and

refrigerators. “Manufacturers of Kenmore products must adhere to the brand’s mantra,” states designer Mike Saubert. “All products must align and look like they all came from the same place. They all have to rep-resent the product in the same way.”

Saubert says what’s interesting about the KCD lab is that engineers and designers work together on prod-uct development. “Each of us thinks differently and working together, we counteract a lot of our own biases. Balancing each other is an art.”

Sears Home Services technicians are also part of the unique develop-ment process. They have access to the laboratory and can breakdown an appliance and enhance their ability to service it properly.

The KCD lab not only develops the products but must also build the devices to measure desired results. “We have to design and construct most all of our test equipment,” Sau-bert says. “We know what we want to measure, and you just don’t go out and buy a machine to do that.”

Once all the testing is done and the product is ready for transport to a store or home, the final stage in the KCD lab is to ensure that the item is packaged properly. Due to the different distribution methods, manufacturers of KCD products must follow Sears’ packaging stan-dards. Products are put through a series of tests that measure vibra-tion, droppage, incline impact and clamp truck simulation.

Down the line, the KCD lab is attuned to reviews of their product, espe-cially those published by Consumer Reports. “We work closely with them to review the results of their product testing, and then make our products better,” said Tom DeSalvo.

KCD continued from page 10

Ron Olbrysh and Tom DeSalvo with 2017 Refrigerator


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THE RETURN OF THE WISH BOOK!Sears announced prior to the holi-day season that it would revive the Wish Book, last available in 2011, as a 120-page catalog and make the book available to its “best” customers and select Shop Your Way members, who will receive an email invitation to pick up a copy at their local store.

The book has also been updated to include a digital edition available on tablets, laptops and smart phones. This digital connection is critical to grab as many shoppers as possible.

The book includes kitchen items, holiday decorations, home furnish-ings, toys and more.

“The goal was to connect with our members and their memories in a deeper level than just social media interaction,” according to Sears’ Chief Marketing Officer Kelly Cook, who said the company’s shoppers shared memories of the catalog from years ago.

“It’s important to understand that the Wish Book is just one piece

of what will be a robust holiday offering from Sears for our Shop Your Way members,” she said. “Ev-erything we are doing this holiday season revolves around our Shop Your Way members and how we can make their lives easier and better.”

Ms. Cook continued, “We heard story after story about the Wish Book … and that people wanted it back, but also wanted a feature that would allow their children to share lists as they’re constantly using their phones and tablets to browse the Web and engage with brands.”

The original holiday guide, formerly known as the “Sears Christmas Book,” was launched during the Great Depression. It featured such gifts as the “Miss Pigtails” doll, Lionel electric trains. Except for two years in the mid-90s, the catalog was released annually for nearly 80 more years.

Sears Not AloneNeiman Marcus also has an annual Christmas Book that includes, in addition to designer gowns and gift

suggestions at various price points, “Fantasy Gifts,” like a “Saint-Tropez Orange” Rolls Royce for $445,750.

“While Sears is struggling and the Wish Book definitely won’t turn the business around, the idea of cata-logs is a good one,” said Suchurita Mulpuru, retail analyst at For-rester Research.

Moreover, with so many deals and promotions hitting mobile devices and inboxes during the holiday season, a catalog can “cut through the clutter,” said Ms. Mulpuru.

But one feature writer for Market-Watch noted that the Wish Book could give Sears a short-term boost, but won’t turn things around long term.

Editor’s Note: This story was as-sembled from articles appearing in the October 29, 2017, issue of USA Today, and an October 28, 2017 Mar-ket Watch article by Tonya Garcia.

RENEW YOUR 2018 SUBSCRIPTION TODAY!Thank you for your financial as-sistance over the past two decades. We could not have achieved this significant event without the broad cross-section support of former and very active Sears’ retired associates.

We are the oldest, active retiree or-ganization in the country. With so few local Sears re-tiree clubs today, N.A.R.S.E. is now the primary con-tact with Sears.

In fact, last June, t he N . A . R . S . E . Board was invited to Sea rs Hold-i ngs cor porate h e a d q u a r t e r s at Hof fman Es-tates, Illinois, to conduct its June m e e t i n g . T h e Sears executives joining us were Erin Geraghty, Mg r. Hea l t h & Welfare who replaced Stan Aldis; Terry Rolecek , Head of Shop Your Way F inanc ia l Ser v ices; Steve Sitley, who is now Gen-era l Counsel of the company; Bob Phelan, Treasurer; Jules Ainsworth, Chief People Officer; Mike O’Malley, VP-Compensation & Benefits; and Mark Semisch, V P- Ch ie f Compl ia nce Of f icer.

This meeting generated the greatest number of conference call participants that we have ever had. It provided all of us the opportunity to have a meaning-ful dialog with the Sears executives.

I hope you found the articles in this issue interesting, informative and help-ful. As you know, our Board of Directors

is an all-volunteer group with no paid employees. We are funded solely by the retiree membership dues and volun-tary contributions. The dues we receive are used to support our communica-tion efforts with the tens of thou-sands of retirees across the country.

Please renew your N.A.R.S.E. mem-bership for 2018. E nc l o s e d i s a N.A.R.S.E. Mem-

bership/Renewal Application form and mailing envelope. If you have already renewed, then pass the application form to someone who would be inter-ested in supporting our organization.

On behalf of our Board of Directors and officers, we wish you a Holiday season filled with Peace and Love … and a New Year Rich with Blessings.

Winter 2018 Issue of STRAIGHT TALKNARSE 1117 insert

SEARS IS STILL “FIGHTING LIKE HELL” TO MAKE THE COMPANY A RETAIL...

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