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Why Sears Ended a Century-Old Partnership With Whirlpool

Shoppers will no longer be able to buy Whirlpool, KitchenAid or Maytag appliances at Sears, following a pricing dispute that has ended a 101-year relationship between the department store chain and the country’s largest appliance maker.

Whirlpool, which announced last month that it is raising prices to make up for costlier raw materials, said it notified Sears Holdings in May that it would stop supplying appliances to the retailer.

"We simply could not reach terms that were acceptable to both parties," Marc Bitzer, Whirlpool’s chief executive, said on a recent call with investors.

The dispute highlights escalating tensions between manufacturers and retailers over exactly how much items should cost. Retailers have grown accustomed to offering steep discounts to win over consumers. Manufacturers, meanwhile, say they are struggling to keep up with growing expenses and stiffening competition, often from overseas.

The news deals yet another blow to Sears, which has already closed hundreds of stores this year. Once a dominant seller of appliances, the company has lost much of its cachet and market share in recent years. It has not turned a profit since 2010, and last year it reported a loss of $2.22bn.

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Whirlpool, which announced last month that it is raising prices to make up for costlier raw materials, said it notified Sears Holdings in May that it would stop supplying appliances to the retailer.

"We simply could not reach terms that were acceptable to both parties," Marc Bitzer, Whirlpool’s chief executive, said on a recent call with investors.

The dispute highlights escalating tensions between manufacturers and retailers over exactly how much items should cost. Retailers have grown accustomed to offering steep discounts to win over consumers. Manufacturers, meanwhile, say they are struggling to keep up with growing expenses and stiffening competition, often from overseas.

The news deals yet another blow to Sears, which has already closed hundreds of stores this year. Once a dominant seller of appliances, the company has lost much of its cachet and market share in recent years. It has not turned a profit since 2010, and last year it reported a loss of $2.22bn.

Read Full Article