USA: New Sears Boss Says Stores Must Try Harder
The new boss of the second largest US retailer, Sears, has demanded a major shake-up, saying the stores are underperforming and the company must do fewer things better. Alan Lacy, who took over as chief executive on October 1, has highlighted low profitability and too many underperforming units as the main problems with the business. In his first address to the investment community since assuming the top job last month, Mr Lacy called 2001 a "transition year," as the company focuses on improving its retail business. Aside from continuing retail initiatives, such as fine-tuning apparel assortments, Mr. Lacy said Sears would aim to tailor its marketing to individual customers rather than focusing primarily on mass efforts, such as newspaper circulars."Our sense of urgency here is high," said Mr. Lacy, speaking before a group of analysts at the Waldorf-Astoria Hotel. "We recognise that we really don't make enough money in our retail business."He has pledged to look closely at the company's fashion lines to increase growth, and added that more clothing would be sourced overseas to boost profits. He said he would like to see Sears improve its profit margin from 3.3 per cent to at least five per cent in the near future. Sears was the `dinosaur' of US retailing when Mr Lacy's predecessor, Arthur Martinez, took over the company eight years ago. His first step was to close and refit many of its outdated stores and increase clothing sales for women. Now the major retailer looks set for another shake-up to boost profits and close the gap with its competitors such as such as Wal-Mart and Home Depot.
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