America's former retail leader closed 1000s of stores, now has 5 left
Daniel Kline
Sat, November 29, 2025 at 12:33 PM EST
7 min read
When I was a kid, the holiday season began when the Toys R Us catalogue showed up in the mail, or maybe inserted into the Sunday Boston Globe.
That catalogue showed basically every toy and game we might ask for over the holiday season. Pretty much every kid in the nation had the same experience, and if you were lucky, you might get to visit a Toys R Us to make your holiday wish list.
The toy brand was everywhere. It seemed like part of the community that would always be there. That, however, was not the case.
Toys R Us died for a variety of reasons. It took on a ton of debt due to a leveraged buyout, which undermined its ability to adapt to a changing retail environment. Had the chain pivoted to an experiential model, leaned into collectible games that need a place for people to play them, and made other changes, perhaps it would still be a national player today.
Instead. Toys R Us never evolved, and Walmart and Target both carried toys, often at lower prices. Those giants, along with Amazon, helped the weakened toy chain toward its death by a thousand paper cuts.
A brand that seemingly every child loved, which was once a must-visit store if you needed toys, had become irrelevant, cash-strapped, and in 2017 was liquidated after it failed to reorganize under a Chapter 11 bankruptcy filing.
Toys R Us was a cautionary tale about retail complacency. As the former general manager of a large independent toy store, I can credibly say that a model could have been found to save the chain.
Yes, Target and Walmart took customers away from the store I ran, but those chains also ignored expensive harder--harder-to-sell board games and collectible miniature games. Had Toys R Us pivoted, something its leveraged buyout cash crunch made difficult, there were clearly ways it could have competed.
Toys R Us, however, was not the only tragedy of American retail. Sears was an even bigger fall as the company went from being America's largest retailer — essentially the Walmart, Target, and Amazon of its day — to a sad relic clinging to existence.
What happened to Sears
Sears' fall from operating around 3,000 stores globally and being the dominant brand in U.S. retail took time and incredible mismanagement.
In 2018, after it had emerged from Chapter 11 bankruptcy, Sears had just under 700 stores and about 68,000 employees. The chain was about one third the size it was at its peak, but it was still a major retailer.
To put things into perspective, Sears’ total revenues fell from $36.1 billion in 2013 to $16.7 billion in 2018, according to Sears Holdings Corporation’s 2018 Form 10‑K filed with the U.S. Securities and Exchange Commission (SEC).
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The chain, however, which had moved from being catalogue based to department stores and malls, had stopped innovating, according to former Sears executive Mark Cohen, now director of the retail studies program at Columbia Business School.
"The company has been on a death spiral for well over a decade," Cohen told CBS. "It lost sight of the fact that change is a constant."
Many trace the beginning of the end to Sears' 2004 merger with Kmart, but the core decline goes back farther than that.
"The combined decline of Sears and Kmart, in terms of sales, is unprecedented, said Greg Portell, an analyst at A.T. Kearney. The seeds were planted by poor decision-making in the 1980s, during which time the company made a real estate play instead of focusing on selling. No senior executive over the next 28 years was able to put stops in place to prevent the slide," The Gazette reported.
'The management mistake that Sears made, in retrospect, was that they never got to a spot where they could stop the free fall,' Portell told the newspaper.
More Retail:
GlobalData Managing Director Neil Saunders was not kind in his evaluation of the brand's failure.
"Sears will now act as a case study in how not to run a retail operation," he told CBS. "It also serves as an example that even the once most powerful and cutting-edge of brands can easily fail in a retail environment where change and evolution are the order of the day."
Sear: 1886 to 2025 timeline
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1886 : Richard W. Sears sells his first batch of watches which was the beginning of what becomes Sears.
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1887: Sears partners with Alvah C. Roebuck, forming what becomes Sears, Roebuck and Co. Source: Transformco
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1893: Sears, Roebuck & Co. officially emerges and begins expanding its mail-order catalog beyond watches. Source: CNBC
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Early 1900s: The catalog business expands dramatically; Sears becomes a staple for rural America through its mail-order service. Source: Transformco
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1925: Sears opens its first brick-and-mortar retail store (in its mail-order complex in Chicago). Source: CNBC
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1927: Launch of the in-house brand Kenmore (appliances) and the famous tools brand Craftsman moves Sears toward a home-goods, appliances, and hardware identity beyond just catalogs and general merchandise. Source: Transformco
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Mid-20th Century (1940s–1960s): Sears grows to be one of the largest and most dominant retailers in the United States (thanks to both mail-order and its expanding retail presence).
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1973: Construction of Sears Tower in Chicago is completed; at the time, it becomes the tallest building in the world — a symbol of Sears’ dominance.
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1985: Sears ventures into financial services by launching the Discover Card.
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1990s: Increased competition from discount retailers and changing consumer habits begin to erode Sears’ dominance. Its retail model, once centered around catalog and full-line stores, begins to show signs of stress. Source: CNBC
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Early 2000s: Sears attempts diversification and restructuring to stay relevant.
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2005: Sears merges with Kmart to attempt a turnaround, forming Sears Holdings Corporation under former Sears executives.
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2010s (leading up to 2018): Years of declining sales, store closures, and underinvestment; Sears fails to adapt quickly to rise of e-commerce and changing retail trends.
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October 2018: Sears Holdings files for Chapter 11 bankruptcy protection after decades of decline. Source: CNBC
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January 2019: Hedge fund ESL Investments (affiliated with Sears' former CEO/Chairman Eddie Lampert) buys the remaining Sears assets including many store leases via auction, forming Transformco to run what’s left.
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2019-2021: Massive store closures progress. By early 2020, dozens more store-locations shutter; the final stores of certain categories close (e.g. Auto Centers).
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December 2022: The smaller-format “Sears Hometown” stores (which had been spun off earlier) file for Chapter 11 bankruptcy, and all remaining Hometown stores are slated for liquidation.
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August 2024: Demolition begins at the old Sears headquarters site (in Hoffman Estates, Illinois), signaling physical dismantling of what was once corporate headquarters.
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August 31, 2025: The last Sears store in Puerto Rico closes, further reducing the chain’s global physical presence.
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2024-2025: The company’s footprint shrinks drastically. By 2025, only five Sears stores remain operational in the U.S. Source: CNN
What's next for Sears?
Sears has five remaining stores, and one of them is clearly in jeopardy.
"One standalone store in Coral Gables, Florida, could be torn down to build 1,000 housing units. Another four operate in malls – in Braintree, Massachusetts; Concord, California; El Paso, Texas; and Orlando Florida. All those malls are owned by Simon Property Group, the nation’s largest mall operator," CNN reported.
The chain has almost no chance of a comeback, according to retail experts.
There is no chance the remaining stores are profitable, said Neil Saunders, managing director of retail for research firm GlobalData.
“Sears wasn’t profitable back in the day when it was a much bigger company with buying power,” he told CNN. “The idea it is profitable with just a small number of stores is for the birds."
The stores may only exist, Saunders suggested, to book accounting losses for tax purposes.
Mark Cohen, a former Sears Canada executive who was formerly head of retail studies at Columbia University, placed the blame squarely on management.
“If you’re in retail and you’re trying to sell something nobody wants to buy anymore, like electric typewriters or video tapes, you’re in a world of hurt,” said Cohen, who blames Lampert for the store’s current state. “But customers didn’t stop buying circular saws or screwdrivers and hammers or appliances. If you’re in retail and you sell things people want to buy, your success or failure is entirely based upon what kind of skill you bring to the table. He had none.”
Related: Costco pulls a popular product line from its warehouse shelves
This story was originally published by TheStreet on Nov 29, 2025, where it first appeared in the Retail section. Add TheStreet as a Preferred Source by clicking here.
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