Sears and Kmart Case

Introduction

In the modern world and with the change of economy, as globalization keeps expanding and as a result corporations continue to grow nonstop, the terrain in which business is conducted faces new and constant changes each day. Changes have to be made and taken place for any organization is to survive. It is this very instability surrounding commerce that has in turn created an environment in which if a business does not have enough resources and corporate power than it will fail to compete against other companies in a rapid paste. It does not come as a surprise to anyone that with the today's economy that we are faced with that hundreds of businesses close down each year due to other corporations taking over the market and changes not being made. Companies are faced with the question of, what to do in this case. For Sears and Kmart the possible solution was the merger between the two giants.

The merger between Sears and Kmart took place in May of 2005 and it was a merger that cost $11 billion. The purpose of the merger of Sears and Kmart was to increase their position in the market and stand a chance against other corporate giant such as Wal-Mart which is currently holding the biggest market share in retail. Nevertheless, there are many consequences in making such a big merger and it should be taken into account by top management before they decide to apply a merger.