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Sears & The 'Dollars for Dishwashers' Dilemma

Imagine you're the nation's largest seller of appliances and the government rolls out a multi-million dollar rebate program to encourage consumers to trade in their energy-guzzling appliances for more energy efficient ones. Good news, right?

Gases are separated by type and sent to Freon recyclers for the secondary market or properly destroyed.
Source: Sears
Gases are separated by type and sent to Freon recyclers for the secondary market or properly destroyed.

Not so fast. Imagine that program, rather than being a one-size-fits-all federal incentive plan is turned into a patchwork of state plans, each with its own start date, rules and requirements. What do you do then?

That's the situation Sears Holding found itself in with a $300 million appliance rebate program that was passed as part of the Obama Administration's economic stimulus bill. Instead of being stymied by the confusing tangle of state programs, Sears is seizing an opportunity born out of the confusion.

Realizing that about 70 percent of consumers begin their appliance shopping online, Sears has enhanced its Web site to provide users with information to navigate the government's appliance program as well as other rebates that were already also available to consumers.

The retailer also is training its employees to assist with the paperwork needed to apply for these incentives so that consumers can pick up their new appliance and know that they are on their way to receiving some cash back.

While there are other Web sites that provide this type of information including ApplianceRebate.com, which we wrote about in December, consumers may not know that these sites exist.

Since some of the state rebates require proof that the appliance was recycled, Sears also is seizing this moment to tout its appliance recycling capabilities.

Gases are separated by type and sent to Freon recyclers for the secondary market or properly destroyed.
Source: Sears
Gases are separated by type and sent to Freon recyclers for the secondary market or properly destroyed.

The Sears' Responsible Appliance Disposal program is certified by the Environmental Protection Agency, the only retailer program with that distinction. Each year, the company disposes of more than one million residential appliances such as refrigerators and freezers, and estimates the program has saved the equivalent of greenhouse emissions from 650,000 cars each year.

The program attempts to recover and recycle many of the appliance parts that can be reused, while keeping hazardous materials out of the waste stream. Appliances are ripped apart. Glass is crushed and recycled, metals such as cooper, aluminum and zinc are harvested and reused, and oil is drained from motors. Even gases like freon can often be recycled, while capacitors with dangerous PCBs are sorted from those that are PCB free.

"This is a whole new area to help customers do the right thing," said Doug Moore, president of Home Appliances for Sears.

Moore expects the government's rebate money to go quickly when the programs are launched in each state, but the approach Sears is using will help customers find additional rebate programs that they may be qualified to use even if the stimulus funds have dried up. Some consumers may even be able to layer on several rebates together to significantly cut the cost of their purchase.

To get the word out, Sears will do some state-specific advertising in certain regions, similar to what it does during state tax holidays, Moore said.

The program comes at a good time. Pressured by the recession and a weak housing market, consumers have been watching their spending closely and big-ticket purchases of appliances have been under pressure. Moore declined to provide specific sales data for Sears' appliances.

More from Consumer Nation:

Questions? Comments? Email us at consumernation@cnbc.com

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