Following a first quarter in which retail sales were down low-single digits, Hudson’s Bay has named a new president of its Canadian division and is implementing a “transformational plan” that includes reducing 2,000 positions company wide.
For the quarter ending April 29, sales were $3.2 billion, down 3% year-over-year. Company officials pinned the decrease on lower overall comparable sales of approximately $94 million and the negative impact on currency exchange rates.
“This was a tough quarter for HBC,” said Richard Baker, HBC’s governor and executive chairman. “While the retail apparel market remains particularly challenging, we are taking steps to adapt, beginning with our transformation plan. This initiative will reshape our organization to accelerate delivery of a best-in-class all-channel experience to our customers while improving our cost structure.”
According to the company, the transformation plan will create two leadership teams, one focused on Hudson’s Bay and one dedicated to Lord & Taylor, to drive market-specific strategies. The Hudson’s Bay leadership team— led by Alison Coville— will focus on accelerating plans to build upon its successful transformation in Canada, while the Lord & Taylor leadership team— led by Liz Rodbell— will focus on increasing the pace of change at the U.S. banner, with an emphasis on driving digital opportunities while operating its stores more efficiently.
The plan also includes the integration of digital functions throughout the organization; realigning resources including IT and digital, store operations and visual merchandising, buying and planning and marketing to increase efficiencies and leverage scale; optimizing in-store service and enhancing sales training for store associates; and reducing its employee base by approximately 2,000 positions.
“We are reallocating resources to accelerate the opportunity we see online, as we run our brick and mortar operations more efficiently,” said Baker. “At this critical moment of change in the retail industry, I believe in the future of our all-channel model and we are adapting to meet the evolving needs of our customers.”
As mentioned previously, Coville will serve as president of Hudson’s Bay. She will lead the management team responsible for directing operations for Hudson’s Bay and Home Outfitters in Canada and will report to Jerry Storch, HBC CEO.