Online shopping takes a toll on Sears Hometown and Outlet Stores sales

The continuing shift to online shopping is taking a toll on Sears Hometown and Outlet Stores, with the retailer reporting a 4.9% dip in store sales during the second quarter.

The seller of appliances, tools and garden equipment struggled in the wake of competitors sharply discounting similar items. But a less-than-optimal online experience has also put a dent in the company's bottom line.

“Shoppers are increasingly choosing to purchase products directly online in our key product categories, as evidenced by our primary competitors continuing to report large online sales gains,’’ Will Powell, the company’s CEO and president, said in a statement.

But the retailer, which split from Sears Holdings in 2012, made changes this past spring to its separation agreements. The amended agreements will enable the creation of online platforms for Hometown, one piece of a larger online overhaul. “We are currently on target to launch the new websites in the fourth quarter of 2016, a quarter earlier than our original plan,’’ Powell said. “We believe this will improve the company’s long-term competitive position.’’

Sears Hometown sells national brands of goods ranging from lawn equipment to home appliances. The Outlet component of the company sells discontinued, overstocked or slightly damaged versions of such items, along with sporting goods, mattresses and clothing, at a steep discount. While stores open at least a year saw a nearly 5% drop in sales, the company’s profit rose to $10.6 million in the second quarter, compared with a $405 million loss during the same three-month period last year. That was largely the result of the retailer selling assets and cutting administrative costs.

Additionally, an effort to shed underperforming stores led to the shuttering of 22 locations during the quarter ending in July. There were no new openings. That also contributed to a 10.2% drop in net sales, to $556.4 million.