Hoffman Estates,IL—Sears Holdings announced today that Ron Boire will become executive vice president, chief merchandising officer and president, Sears and Kmart formats. Boire comes to Sears Holdings from Brookstone, Inc. where he was president and chief executive.
In this new role, Boire will lead merchandising and retail stores for both the Sears and Kmart brands. He also will work with the company’s leadership team to improve customer service and Shop Your Way Rewards Members by integrating their shopping experiences across in-store, online, services, and mobile capabilities.
“We are in the midst of a transformation of our business, from top to bottom, as we seek to become the leading integrated retailer in the country,” said Lou D’Ambrosio, Sears Holdings’ president/ceo. “By attracting someone with Ron’s significant experience in retail, merchandising and product development as well as in leading companies through turnarounds, we’re adding a key talent in accelerating our transformation.”
Boire faces a seemingly daunting task, some retail analysts said. Just last week, Sears Holdings announced it would shutter up to 120 Sears and Kmart stores after its comparable sales in the eight weeks through Dec. 25 fell 5.2%, including a 4.4% drop at the Kmart and a 6% decline at the Sears domestic. And in November, the retailer reported its third quarter loss doubled from the year before as comparable store sales lagged.
Challenging Environment: Store Closures, Credit Downgrades
Retail analysts have been critical of Edward Lampert, whose ESL Investments is a majority shareholder in the company, saying his policy of scrimping on refurbishing and updating stores has hurt sales and lost consumers.
Worse still, Fitch Ratings last week slashed Sears Holdings’ credit rating three notches further into junk territory, saying the department store chain’s plan to close 100 to 120 stores won’t be much help for the company’s cash needs.
Fitch said that while the company has the means to fund its working capital needs in 2012, it may need to raise money to fund operations in 2013. Fitch said the company’s declining profit and sales were a concern, as was its ability to reverse those trends. Another credit ratings agency, Standard & Poor’s, on put its “B” long-term corporate credit rating on Sears on review for a possible downgrade.
“The real question is the same as the last 6 years’ parade of senior executives with any retail experience at Sears: whether the real CEO, i.e. ESL, will give them the authority–and the investment dollars–necessary to turn around a rapidly sinking ship,” said Craig Johnson of Customer Growth Partners, a retail consultant.
Commenting on his appointment, Boire said, “I understand the company’s challenges, but I am more persuaded by the company’s opportunities and strengths. As a company with over $40 billion in sales, millions of customers, irreplaceable brands, thousands of stores and committed associates, we have a lot to work with to improve our business and delight our customers.”
D’Ambrosio admitted that Sears faces some tough choices in the year ahead. “At the same time, we will continue to invest to better serve our customers by delivering world-class, integrated experiences across our stores, our online sites, our services and our mobile capabilities,” D’Ambrosio said. “And, we will continue to invest in our people, ensuring that we have the talent and skills necessary to effect this transformation.”
Prior to Brookstone, Boire served as president, U.S. Toys, North America for Toys “R” Us from 2006 to 2009, overseeing merchandising, marketing and operations for 600 stores in the United States and 70 in Canada. He joined Toys “R” Us after serving as the executive vice president, global merchandise manager for Best Buy, responsible for managing Best Buy’s $30 billion U.S. Business Teams, global technology and vendor management, global sourcing and private label development.
Before that, Boire served in a variety of increasingly senior roles during a 17-year career at Sony Electronics Inc., including president of Sony’s Consumer Sales Company and president of Sony’s Personal Mobile Products Company.