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The first step in the arrangement begins this month as Sears, the nation's largest seller of appliances, moves more aggressively into the market for high-end kitchens. A new Jenn-Air line of luxury cooktops, ovens, dishwashers and built-in refrigerators is slated to arrive in 255 of Sears' biggest stores by Nov. 15.
By January, Jenn-Air will no longer sell appliances through Home Depot and Lowe's, Ann Fandozzi, vice president of sales and marketing for Sears, said at the product unveiling at Sears headquarters in Hoffman Estates on Wednesday.
Sears is hoping the deal will bring back a generation of shoppers that gravitates to stores that are newer to the appliance business, including Home Depot, Lowe's and Best Buy. It's still the dominant appliance retailer, with about 30 percent market share, but the gap between Sears and the rest of the pack has been narrowing for years.
"If Depot and Lowe's are not on the grid anymore, that replacement business will gravitate to Sears," said Doug Moore, Sears appliance division president.
Moore, who joined Sears from Circuit City in 2007, added that the deal will give Sears' appliance business a boost by competing "not just on price."
The home-appliance business accounted for about 15 percent, or $7 billion, of Sears Holdings' fiscal 2008 revenue of $46.77 billion. It is one of the few arenas that Sears Chairman and majority stakeholder Edward Lampert has invested money, even as he closed Sears and Kmart stores and slashed capital spending.
The housing market has dampened Sears' appliance sales, but the retailer has eked out a market share gain in the first three quarters of this year, Moore said, though he declined to be more specific.
Stevenson Co., a widely used appliance-market-share research firm, estimates Sears' share in the third quarter at 31 percent, followed by Lowe's at 20 percent, Home Depot at 11 percent and Best Buy at 7 percent.
Sears' market share was reported to be more than 40 percent at the start of the decade, according to news reports at the time, citing Stevenson. Stevenson declined to comment on past figures.
Shoppers have turned to discount chains in earnest during the recession as they look for the best bargain, said Nick McCoy, home goods consultant at Columbus, Ohio-based Retail Forward.
"This could bring people to Sears stores," McCoy said. "That's been Sears' biggest problem."
Sears and Whirlpool have been working together for almost a century. Whirlpool makes Sears' in-house Kenmore brand. The appliance-maker acquired Jenn-Air as part of its 2006 purchase of Maytag.
Under terms of the agreement, Sears agreed to have 17 Jenn-Air appliances on display and turn key sales personnel over to Jenn-Air for training.
Jenn-Air plans to fly 255 Sears sales associates, one from each Sears store carrying the luxury line, to its training facility in Atlanta by the end of the year to school them on how to sell the high-end machines.
Among the "wow" features Sears will show off to shoppers: A wall oven, priced between $3,000 and $5,000, has a touch screen that displays photos of recipes and adjusts the temperature based on such details as the size of the roasting pan.
Sears is reviewing its commission structure to determine if it needs to be changed to reflect the more time-involved sale, Moore said.
smjones@tribune.com
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