Sears Holdings, once the biggest retailer in the country, is on the verge of filing for bankruptcy after 125 years in business.
The decline of one of America's most recognizable home brands has been decades in the making and marked by a series of missteps that could have changed the course of the company had they been averted.
The department store chain, led by hedge fund manager and CEO Eddie Lampert, has steadily been shrinking its assets over the years as its lost sales to Walmart, Target, Home Depot, Amazon and other competitors for its signature appliances and "Softer Side of Sears" apparel.
CNBC looks at five things that caused Sears to fail in recent years.
1. It diversified too much
Sears was struggling before it got into Lampert's hands.
The retailer was known for its DieHard, Craftsman and Kenmore brands that catered mostly to men shopping for home-building products. In a bid to increase sales amid increasing in the 1980s, Sears tried to go after female shoppers.
Under CEO Arthur Martinez, a former Saks Fifth Avenue executive, it launched "The Softer Side of Sears" ad campaign in 1993 to draw more women and back-to-school shoppers. But the clothes in Sears stores didn't mix well with the washing machines and treadmills it was also trying to sell. It only made the merchandising more confusing for many shoppers, said former employees who spoke with CNBC earlier this year.
The ad campaign was seen internally as an early sign that Sears was heading in the wrong direction, those people said. It also diversified its business, adding on insurance, banking, investments and real estate. Martinez blames that diversification for losing focus in his book, "The Hard Road to the Softer Side: Lessons from the Transformation of Sears."
"We had made embarrassing mistakes," he said. As Sears stumbled, its competitors Walmart and Home Depot were gaining steam and market share.
2. It merged with Kmart
Before Lampert bought Sears in 2004, he purchased discount retailer Kmart out of bankruptcy. He then took two already weak retailers and merged them in 2005.
The hedge fund owner saw value in the retailers' real estate and believed that combining two fading giants would make them stronger. At the time, he said he thought he would be able to bring together Sears' Craftsman tools and Kmart's Martha Stewart Everyday home goods in stores to make a merchandise mix that could compete with the likes of Target and Walmart. He also thought he would be able to cut costs by selling under-performing stores and then rebuild a smaller, mightier business.
But some analysts say Lampert hasn't been able to do either. Sales haven't manage to rebound, and stores continue to go dark across the country as they can't achieve profitability, and shoppers are finding better options elsewhere.
"The solution to Sears' problems was to buy another retailer not doing well, and that was Kmart. Then they got a bigger bad business," Neil Saunders, managing director of GlobalData Retail, told CNBC. "Sears wasn't investing or changing, and they started to suffer because of that."
3. It cut too much
As other retailers have poured money into their businesses, Sears has arguably been on the sidelines. A report from Susquehanna Financial Group had said Sears in 2017 was spending roughly 91 cents per square foot to make upgrades both online and in stores, while J.C. Penney spent $4.13, Kohl's was paying $8.12, and Best Buy was forking out $15.36 per square foot to make enhancements.
The trend started under Martinez. Under his tenure as CEO, from 1995 to 2000, Sears closed more than 100 stores, laid off more than 50,000 workers and discontinued Sears' famous catalog. He was trying to slash costs as sales started to fall, but the troubles only mounted.
When Lampert took the helm as CEO in 2013, he continued to cut some of its marquee brands and assets. The company has since sold off its credit card portfolio to Citibank, the Craftsman tool brand to Stanley Black & Decker, spun off Lands' End and shuttered hundreds of stores. It also has failed to invest back in its remaining stores.
"I think if it was any other retailer they probably would've already filed for bankruptcy," Retail Metrics founder Ken Perkins told CNBC. "But in Sears' case, someone with deep pockets is able to influx cash, extract real estate and sell off assets ... the cupboard is running very bare and there isn't a lot left."
4. It sold good real estate
After Sears merged with Kmart, the holding company had more than 3,500 locations. Today, it has fewer than 900, many within shopping malls that are already struggling to draw foot traffic as more and more shoppers go online.
Lampert sliced off a big chunk of stores for cash when he spun out 250 of its best properties into real estate investment trust, Seritage, in 2015. In doing so, Sears has faced the tough task of turning itself around with only the support of its weakest stores.
That has in many ways expedited its decline, as its continually had to shed more real estate and assets to pay off debt. As part of a last-ditch effort, Lampert most recently proposed Sears sell another $1.5 billion in real estate in order to come up with cash to keep the company afloat, with a major loan payment coming due.
"Sears has sold most of its top real estate over the past ten years and its remaining properties may not be worth much," Edward Jones analyst Matt Kopsky said. "I don't see a scenario where this improves by [Sears] waiting."
5. It's run like a hedge fund
Lampert's background is finance, not retail.
The CEO started his career as an intern at Goldman Sachs in the 1980s and launched his own hedge fund by 1988. That training awarded him the name as the "next Warren Buffet" when he went into retail and helped bring Kmart out of bankruptcy. Many followers believed he could apply his financial prowess to extract value out of Sears when traditional retail executives might've lacked such acumen.
But years of financial maneuvering at the expense of investing in Sears' stores have left many wondering whether his background was a weakness, not a strength.
"The story of Sears over the past year has been about the debt situation and trying to rework the debt payments coming due," said Ray Wimer, an assistant professor of retail practice at Syracuse University's Martin J. Whitman School of Management. "The bigger issue that has not been discussed is the actual merchandise and the retail performance of the company that has been on a downward trend the last 10 years."
Ironically, Sears' financial performance pales in comparison to its peers in the retail industry.
Sears burned through $1.8 billion in cash in its operations during 2017, $1.4 billion during 2016 and $2.2 billion during 2015, SEC filings show. Sears hasn't turned a profit consistently since the early 2000s, and its last profitable year was in 2010. Same-store sales, a key performance metric for retailers, have been in a steady decline for more than a decade.