The company competes on an average price level on par with J.C. Penney. Sears has also recently rivaled with Belk, Dillard's, and Macy's. However, the company competes below Bloomingdale's, Neiman Marcus, Nordstrom and Saks Fifth Avenue.

History

In 1886, the United States contained only thirty-eight states. Many people lived in rural areas and relied on agriculture. For many Americans, a single general store was their source of supplies. Merchandise went through many wholesalers on the way to the retail outlet, not an inexpensive method of handling. Many general stores received their shipments of merchandise through the growing network of railroads.

Richard Sears and a shipment of watches

Richard Sears was a railroad station agent in Minnesota when he received a shipment of watches which were unwanted by a local jeweler. Sears purchased them himself, sold the watches at a nice profit to other station agents up and down the line, and then ordered more for resale. Soon he started a business selling watches through catalogs. The next year, he moved to Chicago, Illinois where he met Alvah C. Roebuck, who joined him in the business. In 1893, the corporate business name became Sears, Roebuck and Company.

Competing with general stores through mail order catalog

Richard Sears knew that farmers often brought their crops to town, where they could be sold and shipped. Before the Sears catalog, farmers typically bought supplies (often at very high prices) from local general stores. Sears took advantage of this by publishing his catalog with clearly stated prices, so that consumers could know what he was selling and at what price, and order and obtain them conveniently. The catalog business soon grew quickly. By 1894, the Sears catalog had grown to 322 pages, featuring sewing machines, bicycles, sporting goods, and a host of other new items.

Organizing the company so it could handle orders on an economical and efficient basis, Chicago clothing manufacturer Julius Rosenwald became a part-owner in 1895. Alvah Roebuck had to resign soon after due to ill-health, but the company still retained his name. By the following year, dolls, refrigerators, stoves and groceries had been added to the catalog.

Sears, Roebuck and Company soon developed a reputation for both quality products and customer satisfaction.

Sears catalog homes

People had learned to trust Sears for other products bought mail-order, and thus, sight unseen. This laid important groundwork for supplying a home, possibly the largest single investment a typical family would ever make. In 1908, the company began offering entire houses as kits, marketed as Sears Modern Homes, and by the time the program ended in 1940, over 100,000 had been sold.