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Sears Holdings Corp (SHLD) And The Kardashians Split

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The retailer, which has been struggling for some time, announced that it will not be stocking the Kardashian Kollection anymore. Stock was withdrawn earlier this year, according to a spokesman for the company, who said that the decision was mutual. The relationship began in 2011, and was designed to increase Sears’ fashion quota, while bringing the Kardashian’s products to the mass market, writes Phil Wahba for Fortune.

Kollection never lived up to optimistic forecasts

Unfortunately for Eddie Lampert, Kim, Kourtney and Khloe Kardashian, their collection was less than popular with Sears customers. Despite initial forecasts which claimed that the collection would generate between $200-300 million annually, the products were regularly found to be heavily discounted in store.

“We have enjoyed a positive relationship for over three years and proud that we were their first partnership in apparel,” read a statement from Sears’ spokesman Brian Hanover. The Kollection featured apparel, handbags, lingerie, jewelry and footwear, and was sold at 400 Sears stores.

The partnership was met with widespread incredulity at the same of its announcement, with the flashy Kardashians an obvious mismatch with discount store Sears. Celebrity website TMZ claimed that the Kardashians withdrew from Sears due to the retailers struggles, but Hanover called the report “totally false.”

Sears’ struggles continue

Sears Holdings sales numbers have been weak for a number of years, and in February the company reported its 11th straight quarterly loss. Sales fell 7% at Sears itself and 2% at Kmart. The company has lost around $7 billion over the last 4 fiscal years.

The collaboration with the Kardashians obviously did not have the desired effect, and Sears can hardly wait to get the merchandise out of the door. According to one report, a women’s lace bodice was on sale for $29.99, a massive discount on its normal price of $189.

The Kardashians may be gone, but both Adam Levine and Nicki Minaj sell collections at 500 Kmart stores. Hanover stated the Sears is now focused on “elevating product in our private label brands and rightsizing our brand portfolio” in its apparel sector. The company sold a total of $3.7 billion in apparel and soft home goods last year, representing 22% of total sales. However, gross profit margins in the category decreased, and the Kardashians must take part of the blame.

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