Maybe it’s time for Sears Holdings (NASDAQ:SHLD) to consider the unthinkable. No, not seek bankruptcy protection, though that’s likely in the cards if it doesn’t do something soon, but rather follow some other retailers in becoming an online-only retailer.

With Payless filing for bankruptcy protection and closing stores, the number of retail bankruptcy filings so far in 2017 has already surpassed the total number of retailers that went under last year. In the news recently is a report that mall-based Bebe is trying to forestall a bankruptcy filing by becoming a hip e-commerce-only women’s retailer, and that might be a way for Sears and Kmart to avoid what’s increasingly looking like an eventuality for them.

Entrance to Sears store in Danbury, Conn.
Image source: Sears Holdings.

Death looms large

The number of companies on a Moody’s Investor Services list of distressed retailers is the highest it’s been since the Great Recession, though with Payless succumbing, the number is now reduced by one to 18. Other stores on the list include Claire’s, J. Crew, True Religion, and Sears Holdings.

The impact from e-commerce leaders like (NASDAQ: AMZN) on one side and discount retailers such as T.J. Maxx on the other has caused rumors to circulate that even more financially sound retailers like Macy’s (NYSE: M) may get bought out, while office supplies retailer Staples is reportedly considering having private equity firms take it out of the public spotlight.

If they’re seeing the future as too much to handle on their own, how can a financially distressed company like Sears Holdings hope to make it? It probably can’t, and that’s why the online-only option is intriguing.

Stripped down to its essentials

For one, although it’s still rare for a retailer to scale back to being exclusively an online brand, these days it’s becoming more fashionable. Just this past January, The Limited closed all 250 of its stores and moved its clothing sales online, while Kenneth Cole announced in November it was closing all but two stores as it moved its business online as well. Before that, bankrupt Filene’s Basement — a discount retailer that closed down in 2011 but was apparently ahead of its time considering the success T.J. Maxx,…