At Sears, three reasons for layoffs

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HOFFMAN ESTATES, Ill., June 18 (UPI) -- U.S. retailer Sears Holdings Corp. said training, a phone number and a new cash register system would allow it to lay off about 700 appliance sales people.

The toll-free phone number would be displayed on appliances in the Kmart stores affected by the staff reduction, in case customers have questions, the Chicago Tribune reported.

The training is for remaining sales associates who will soon have to sell appliances that were handled by others. The new cash register system would allow customers to pay for appliances anywhere inside the store, rather than just in the appliance department, Sears said.

Stores often make staff cuts during a downturn, but this is the wrong response, said Love Goel, chairman of GVC Capital Group, a retail-oriented private equity firm.

Having knowledgeable sales staff available to customers increases sales up to 40 percent, he said.

"This doesn't make any sense. This is a category they should dominate. They should be doubling down," Goel told the Tribune.

In the first quarter of the year, Sears lost $170 million with revenue down 3.4 percent to $9.7 billion.

Sales declined 5.2 percent at Sears stores and 1.6 percent at Kmart stores in the quarter, using figures from stores open at least a year, the newspaper said.