This all boils down to marketing. Sears couldn't keep up, and now it's too late to do much about it as-is.
If I were responsible for the line, I'd focus hard on owning previous mistakes, and use it as an opportunity to show how much weight this brand can toss around when it tries.
I'd bring it up from the ashes, transparently, as a new entity in the modern world, with it's own structure from management to sales. Craftsman would be re-branded as a bold, strong tradition that's willing to fight it's way into the hearts of a new generation.
Production would scale back closer to core products, and a new focus would be placed on the people behind the manufacture and use of the tools, both young and old. A certification program would be created to recognize accomplishments on both fronts.
Importantly, I'd lean into media production. Craftsman is a brand that will make the most of a solid web series. Humorous, historical, educational, and most importantly relevant; I'd give the name a life of it's own again.
There's plenty left in this nation to produce a core tool line, and sharing factories among a few brands for a few years might actually allow some new facilities, which we need. Let the brand out-grow that housing over time. It has what it takes to do it if fed properly.
If there's one thing Craftsman has been sorely missing for... well... ever, it's a proper production agreement or manufacturing facility of it's own. That should be the end game. Craftsman cannot survive any longer until it's not whored out to whatever factory will take it that month.
The number of contracts need to be reduced dramatically. The line can continue with fewer than five. With regrouped production, a transparent process, a slow fading of Sears, a focus on those who build and use the tools, and solid, entertaining media, the brand can survive and thrive.
The only question is this: How patient is Stanley, and are they willing to spend any more money? The terms of the deal may seem long, but it's pretty tight. It might not be in their best interest to resurrect the brand.
...Because that's what it's going to take: A proper resurrection. All that is Craftsman needs to be on the chopping block if Craftsman is ever to rise again. It's got to be seen rising from complete failure, into an apparent boutique brand, and then into a power player again with the customers behind it.
If that's not Stanley's game, and they just want another name on the shelf at Walmart, they need to snap up those production contracts, buy some Stanley stickers, and pick the bones clean, because that's all Craftsman is good for at this point.
All they ever had is brand recognition, and they sure as heck don't have much of that now. It's got to start over, and the people in charge have to accept that they preside over nothing more than a few other people, who preside over what amounts to another bucket of nothing.
