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 CHICAGO - 
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TextualOrganization
Point-of-Origin
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Sears, Roebuck & Co. is struggling 
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span

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as it enters the critical Christmas season.
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temporal-same-time

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 Yesterday, the retailing and financial services giant reported a 16% drop in third-quarter earnings to $257.5 million, or 75 cents a share, from a restated $305 million, or 80 cents a share, a year earlier.
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comparison

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 But the news was even worse for Sears's core U.S. retailing operation, the largest in the nation.
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span

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 Sears said 
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attribution

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its U.S. stores had a loss of $6.9 million, their first deficit for the period in more than five years.
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 Analysts estimated 
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attribution

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that sales at U.S. stores declined in the quarter, too.
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 The results underscore Sears's difficulties 
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in implementing the everyday low pricing strategy 
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that it adopted in March as part of a broad attempt 
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to revive its retailing business.
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elaboration-object-attribute-e

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 Under the new approach, Sears set prices 
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that were somewhere between its old regular and sale prices.
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elaboration-object-attribute-e

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 The company said 
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attribution

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it would resort far less often to slashing prices 
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to woo shoppers.
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purpose

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 Sears officials insist 
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attribution

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they don't intend to abandon the everyday pricing approach in the face of the poor results.
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 Instead, a spokesman blames the dismal third-quarter showing on an environment
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 that is being distorted by a very harsh climate for sales of durable goods, 
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which account for roughly two-thirds of Sears's annual merchandise volume. 
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elaboration-additional-e

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 The new pricing strategy is working, 
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the spokesman asserted.
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attribution

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 He added 
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that, 
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after an initial surge 
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triggered by an advertising blitz in March,
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 Sears expected 
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attribution

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that the pricing program wouldn't have any effect on revenue.
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 Sears has been counting on growth 
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coming from the large displays of brand-name merchandise 
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it is adding to its stores over the next two years 
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in what it calls power formats. 
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 But analysts say 
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Sears faces an especially daunting challenge on the eve of the Christmas shopping season.
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 I believe 
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attribution

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everyday pricing in the current environment doesn't work, 
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says Walter Loeb of Morgan Stanley & Co., 
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pointing to soft durable-goods sales.
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elaboration-additional-e

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 Sears is likely to be unsuccessful 
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if it continues with its pricing policy 
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condition

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when everyone else is offering unusual values.
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contingency

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 In what amounts to an admission 
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that the transition hasn't gone as smoothly as Sears had hoped, 
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the giant retailer is now trying new ways 
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to drum up business 
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elaboration-object-attribute-e

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without appearing to abandon its seven-month-old strategy.
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Contrast

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 The company is highlighting more special deals in its advertising and stores,
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List

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 and it's offering to defer finance charges on certain big-ticket items.
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List

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 Sears is also stepping up its television ads 
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List

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and changing its message.
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List

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 In a new TV ad, for instance, a woman 
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going through the Sunday newspaper
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 brands as hype claims by other stores 
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that they are offering goods for 50%, 60% and 70% off.
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 By lowering prices throughout its stores, 
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she says, 
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attribution

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Sears has the right idea.
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 But the ad also mentions Sears's sales 
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-- a topic 
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that the retailer has avoided 
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since switching to everyday pricing. 
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When Sears has a sale at a special price, 
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the woman in the ad declares, 
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attribution

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it's something 
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you don't want to miss.
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 Recent surveys by Leo J. Shapiro & Associates, a market research firm in Chicago, suggest 
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attribution

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that Sears is having a tough time 
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attracting shoppers 
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elaboration-object-attribute-e

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because it hasn't yet done enough 
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to improve service or its selection of merchandise.
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elaboration-object-attribute-e

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 The number of people 
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span

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who said 
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attribution

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they were more likely to shop at Sears 
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fell in September to 37% from 66% in March, 
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Same-Unit

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when Sears blanketed the airwaves with ads about its new pricing strategy. 
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circumstance

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 Moreover, the number of people 
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who spontaneously cited lower prices as the reason for their interest in Sears 
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declined to 16% in September from 33% in March.
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Same-Unit

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 Just 5% of the respondents mentioned brands in September, up slightly from 2% in March.
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List

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 Only 2% of the people in September cited Sears's friendly personnel.
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List

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 The power of price as an appeal, 
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which was very considerable in driving traffic in March and April, 
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elaboration-additional-e

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has diminished, 
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says George Rosenbaum, president of Shapiro & Associates.
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attribution

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 You see some improvement in these other areas, 
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antithesis

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but it's a very small and slow process.
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span

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 For the third quarter,
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 Sears said 
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attribution-e

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its total revenue rose 4.8% to $13.18 billion from $12.57 billion a year earlier.
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Same-Unit

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 Net income at Sears's merchandise group, 
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which includes international and credit card operations, as well as U.S. stores, 
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elaboration-set-member-e

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fell 25%.
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Same-Unit

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 Profit at Sears's Allstate insurance unit fell 38% to $126.1 million 
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because of Hurricane Hugo, 
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which inflicted the greatest single storm damage loss in the company's history.
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elaboration-additional-e

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 Sears said 
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attribution

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claims from the storm, 
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as expected, 
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reduced its third-quarter net by $80 million, or 23 cents a share.
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Same-Unit

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 Allstate is expected to absorb another big hit in the fourth quarter 
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as claims pour in from the San Francisco earthquake.
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circumstance

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 But a spokesman said 
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attribution

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the quake won't have as big a financial impact on Allstate 
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Analogy

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as Hurricane Hugo did.
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Analogy

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 Net income at Sears's Dean Witter Financials Services group, meanwhile, rose nearly 32% to $35.7 million, 
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reflecting improvements in its basic stock brokerage and Discover credit card businesses.
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elaboration-additional

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 Profit at Sears's Coldwell Banker Real Estate Group nearly quadrupled to $81.2 million 
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because of gains on sales of property.
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consequence-n

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 In New York Stock Exchange composite trading yesterday, Sears shares closed at $40.50, up 87.5 cents.
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