Sears, Roebuck and Co. implements ProfitLogic's Merchandise Optimization Solution to improve performance of softline business

Sears to Bolster Its Merchandise Performance Improvement Project (MPIP) by Applying Customer Insight and Analytics to Its Markdown Process

BOSTON, MA, July 19, 2004 -- ProfitLogic, whose suite of Merchandise Optimization solutions helps retailers make more profitable merchandising decisions, announced today that Sears, Roebuck and Co. (NYSE: S) will undergo an implementation of ProfitLogic's Markdown Optimization solution for apparel merchandise in its 870 U.S.-based stores. This initiative is designed to bolster Sears' strategic Merchandise Performance Improvement Project (MPIP), which was launched in 2003. ProfitLogic will provide Sears with analytics and a new approach to merchandising that will result in improved financial performance.

"We have refocused our efforts on the softlines business," said Alan Lacy, Chairman and CEO of Sears. "We have created a new merchandising organization whose goal is to increase margins and market share and decrease markdown rates in the apparel business."

Sears wanted a solution that would deliver high value in a short period of time. After investigating their options, the merchandising team determined that ProfitLogic's solution, running on IBM hardware and software, offered an innovative and streamlined approach to merchandising decision-making. Once implemented, the merchant and planning teams will have a single source for information, an automated process, and a solution that allows them to understand the ramifications of their decision-making. Ultimately, this will allow the merchant and planning teams to make more effective use of their markdown dollars.

"After much investigation, we realized that in order to dramatically improve our merchandising processes, we need to supercharge our decisions with analytics and better information about our customers' needs," said Steve Poplawski, VP of Integrated Merchandise Planning and Placement at Sears. "We chose ProfitLogic for a couple of reasons. The ProfitLogic team demonstrated a solid understanding of our business and they have a proven track record with 20 retail customers that are achieving significant performance improvements."

"We are very pleased to be working with Sears in an effort to improve its softlines business," said Tom Ebling, ProfitLogic's Chairman and CEO. "We're excited to help the company positively impact its financial performance through the use of analytics and a better understanding of customer demand."

ProfitLogic provides industry-leading Merchandise Optimization solutions designed for retailers whose top priority is getting the highest return on inventory investments. ProfitLogic's customers have found that using insights into future customer demand results in more profitable merchandising decisions and more time to focus on what matters most: the customers and the merchandise. ProfitLogic's solution for Sears supports IBM DB2 Universal Database and IBM WebSphere Internet infrastructure software, and runs on AIX5L for eServer and pSeries as well as Linux on eServer and xSeries.

About Sears, Roebuck and Co.

Sears, Roebuck and Co. is a leading broadline retailer providing merchandise and related services. With revenues in 2003 of $41.1 billion, the company offers its wide range of home merchandise, apparel and automotive products and services through more than 2,300 Sears-branded and affiliated stores in the U.S. and Canada, which includes approximately 870 full-line and 1,100 specialty stores in the U.S. Sears also offers a variety of merchandise and services through,, and specialty catalogs. Sears is the only retailer where consumers can find each of the Kenmore, Craftsman, DieHard and Lands' End brands together -- among the most trusted and preferred brands in the U.S. The company is the largest provider of product repair services with more than 14 million services calls made annually. For website access log onto

About ProfitLogic

ProfitLogic's industry-leading suite of Merchandise Optimization solutions helps retailers make more profitable merchandising decisions. The suite, based on the company's 20 years of experience providing analytical solutions for critical merchandising issues, is focused around four central merchandising processes: assortment planning, allocating, pricing and promoting. ProfitLogic has delivered fast, flexible solutions with significant financial benefit to industry leading retailers such as American Eagle Outfitters, AnnTaylor, Bloomingdale's, Charming Shoppes, Gap Inc., including: Banana Republic, Gap, Old Navy, Gap International and Gap Outlet; The Home Depot, JCPenney, Lerner New York, Marshall Field's, Meijer Stores, Northern Group Retail, ShopKo Stores, Target Stores and Toys R Us. For more information about Cambridge, Mass.-based ProfitLogic, call 617-218-1900 or visit

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