How Sears mixes stocks, bonds, and paint

Stocks, bonds, and real estate investment trusts are pretty upscale. Easy Living paint, Kenmore appliances, and Die Hard batteries are fairly basic. Can the two be mixed?

That is a question many people have put to Carl Hulick, senior vice-president of the Dean Witter Reynolds brokerage firm, since 1981 a division of Sears, Roebuck & Co.

Mr. Hulick's answer: If you are buying paint, appliances, or garage door openers (Sears controls the lion's share of these and other household markets), you are probably a homeowner. If so, you are in an income or asset bracket in which you'll need, well, ''more for your life.'' Enter Sears, the world's largest retailer of general merchandise.

With all the debate today about the benefits and dangers (and apparent inevitability) of ''financial supermarkets,'' Sears comes closest to actually looking like one. Banks may offer discount brokerage and give away toasters when you open a big account. Brokerage and insurance firms may offer products just a shade removed from banking. But Sears can actually sell you a chain saw, kiddie photos, and, at 232 stores throughout the country, securities, insurance, real estate. In California, the chain operates Sears Savings Bank, a savings-and-loan.

Hulick contends that Sears' demographics match the demographics of the United States almost exactly. Over the years, the chain has functioned well as a contact point for salespeople with Allstate Insurance. With that model in mind, Sears acquired Dean Witter and the Coldwell Banker real estate firm, setting aside floor space for them to make contact with customers.

Hulick contends that these financial services are not just loss leaders or lures for the idling spouse during a shopping trip. Nor, he says, are the new accounts that Dean Witter is opening through its Sears offices simply taking business away from other brokerages.

''Sixty percent of our new accounts are first-time brokerage customers,'' he says. ''They are mostly people looking for financial planning help. Our people are encouraged to develop a relationship with a household, and that leads to multiple accounts.''

Hulick says Dean Witter is hiring and training brokers at a time when most other brokerages are being hit with layoffs. He expects the firm to have 3,500 brokers by 1988. If each of them has 125 to 150 client households, with $50,000 to $100,000 in asset savings, Dean Witter will be able to ''influence'' $17.5 billion in capital. That would increase Dean Witter's financial market share from 7 percent to 15 percent in four years, he says, and meet Sears' goal of becoming ''the low-cost provider of transaction services.''

The Chicago-based corporation is forging ahead with its financial service centers in its stores throughout the country. Thirteen new branches were opened in Massachusetts last week. As yet, the profit picture of Sears ''financial service centers'' is mixed. Net income for the chain rose 14 percent, according to the corporation's second-quarter report, issued this week. But Dean Witter lost $22.7 million. Most other securities firms lost money in the second quarter , too, because the downturn of the financial markets.

Although retailing is still carrying the bulk of Sears' business, the Value Line Investment Survey notes:

''Sears is well on its way to becoming a supermarket for such services. Its strong store network, solid consumer franchise, huge customer base, and strong finances all lead us to expect success in this area.''

So it does appear that finance and merchandising can be mixed. But should they be? That is another question - one that politicians, competitors, and Sears are at loggerheads over. There is concern over possible erosion of the legal separation between banking, securities dealing, and nonbank activities that was mandated after the 1929 stock market crash.

Sears says there are plenty of safeguards already in place and that ''market driven'' deregulation of financial markets benefits consumers and the nation as a whole by encouraging savings and investments.

Three bills in Congress address this issue: The Senate version, sponsored by Sen. Jake Garn (R) of Utah, is the more lenient on the nonbanking sector; a House bill sponsored by Reps. Fernand J. St Germain (D) of Rhode Island and Chalmers P. Wylie (R) of Ohio would effectively halt deregulation; Rep. Timothy E. Wirth (D) of Colorado offers a bill to put a two-year moratorium on such moves. Sears officials concede that some form of ''reregulation'' will pass eventually.