Sears, Roebuck & Co., the nation's biggest retailer, said yesterday it will phase out Sears World Trade Inc., a Washington-based unit that was created in 1982 to dominate import-export markets but instead has lost $ 60 million and been a constant corporate headache.
The decision entails the immediate dismantling of the trade operations in the United States and will send the division's 300 U.S. workers -- including about 100 in the D.C. area -- scrambling for new jobs. The unit's overseas operations, at least initially, will be folded into Sears' merchandise division.
Sears said it will provide "job placement or job placement assistance" for displaced workers. But company sources said that D.C. workers who want to remain with Sears likely will have to move to its headquarters in Chicago.
Among those who will be job hunting is Frank C. Carlucci, a former deputy secretary of defense who in April 1984 became chief executive of the troubled Sears unit, company sources said.
Carlucci said through his secretary that he was not available for comment.
By closing the world trade unit, Sears is publicly admitting what many in the company and on Wall Street have known for months: The unit, which has lost $ 12 million so far this year, was a mistake for the retailing giant.
"In a nutshell, we didn't have the expertise," said a top Sears executive, who spoke on the condition that he not be named. "This shows that maybe we weren't as smart as we thought we were about world markets."
Among the Washington area employes affected by the decision are 35 workers at the International Planning and Analysis Center, a consulting firm based in the District and one of several subsidiaries of Sears World Trade.
Industry sources said yesterday that Sears is looking to sell all of these subsidiaries, which include 1,100 employes worldwide. In the meantime, they will operate as part of the Sears Merchandise Group, which operates the retail stores. These subsidiaries range from a Dutch trading company to overseas pulp and timber operations.
If the subsidiaries are sold, Sears' four-year venture will have been completely dismantled.
Wall Street appeared to welcome the decision. "The significance of the announcement is in the message it sends that they're willing to throw in the towel on a money-loser," said Linda Kristiansen, analyst at Paine Webber in New York.
"Sears World Trade is a tiny unit, a speck compared with the rest of the company," she said, but even so, shedding it is wise because it "didn't fit" with the company's other businesses. Last year, Sears' total revenue was $ 40.72 billion, and its earnings were $ 1.3 billion.
Sears' goal for several years has been to build a financial services empire that sells retail consumers everything from kitchen sinks and work clothes to credit cards and insurance. Wall Street has dubbed the strategy "stocks and socks."
To finance that ambition, Sears has been cleaning house. In recent months it closed several money-losing retail stores and eliminated four regional offices. Closing the world trade unit is another step in that process, Kristiansen said.
Sears stock closed yesterday at $ 42.75, up 37 1/2 cents on the New York Stock Exchange.
Sears Chairman and Chief Executive Edward A. Brennan said yesterday that the decision will not materially affect Sears' 1986 earnings.
Sears said it will honor existing trade contracts of the world trade unit's U.S. operations, company officials said.
The subsidiaries that will be transferred to the merchandising group include Sears World Trade's controlling interest in several units of Hagemeyer N.V., a Dutch trading company; Price & Pierce, a paper, pulp and timber company in the United Kingdom; the D.C. consulting firm, and the consulting firm of Harbridge House of Cambridge, Mass.
With the end of Sears World Trade, Sears is left with four units. They are, in addition to the Sears merchandise group: Dean Witter financial services group, Sears Mortgage Corp., which includes Coldwell Banker, and the Allstate insurance group.
Sears' announcement yesterday marks an abrupt end to a unit that has been in upheaval since its founding in 1982.
The unit's first chairman, Roderick M. Hills, who was head of the Securities and Exchange Commission under President Ford, had grandiose plans to build the divison into the biggest and best American trading company.
His plans, which included doing everything from building pulp mills in China to exporting logs from Indonesia, proved too much for top Sears officials. In April 1984, they booted Hills in a stated attempt to bring the division down to earth.
Carlucci, who joined the unit in 1982 as president, became its chairman and chief executive after Hills' departure. About 18 months ago, Charles F. Moran, a Sears trouble-shooter from the company's Chicago staff, was brought in to help decide the unit's fate. Sources at Sears said yesterday that one tip-off that Sears had decided to dump the unit came six months ago, when Moran was transferred to Dean Witter.