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Toronto, Sears Canada has dramatically reduced its workforce amid declining sales, but newly appointed acting CEO Ronald Boire insists he hasn’t come to Canada to play the retailer’s swan song.
“If you look at my past that’s not what I’ve done,” he said in an interview Wednesday at the company’s headquarters in Toronto.
“I’ve focused on the product, the customer experience, and build-and-recover plans.”
Boire, who arrived in Toronto from the executive offices of U.S. parent company Sears Holdings Corp. last month, outlined his vision for a refined version of the department store operator that he hopes will chart a recovery.
One of the first steps is taking a close look at each department and scaling back on products that don’t sell like they used to.
“There are assets we may have over invested in,” Boire said. “Those are fair questions for us as we look at how we allocate space.”
Think big screen TVs which line the walls of the electronics department, an area Boire considers “a tough category” for profit margins.
Floor space for large electronics would better off going towards its more successful categories, like home decor, bedding and appliances, he said.
Bigger investments also need to be made in creating a seamless experience between Sears locations and its online store, Boire added.
Sears Canada will launch a feature next week that lets shoppers check inventory at their local store, while plans are underway for local stores to ship online orders or let customers pick up online purchases at the store.
“There’s a lot of road ahead of us and a lot of decisions to make in the coming years about how we position the brand,” he said.
With Sears Canada, Boire is taking on a major challenge: charting the course for a company that is seen by some to be foundering in a sea of heavy losses and declining sales in an increasingly competitive market dominated by discount retailers.
But the company’s problems have been developing for years, compounded by what some analysts have said was a lack of enthusiasm by the U.S. parent company’s chairman and CEO Edward Lampert, who kept a tight leash on the retailer’s expenses and refused to renovate aging stores.
Lampert, and other investors, have gained financial rewards from Sears Canada’s struggles, with a hefty dividend of nearly half a billion dollars last November from the sale of leases to some of its most prominent locations, including its flagship location at the Toronto Eaton Centre.
Boire defended some of the decisions made by his bosses.
“We’ve got a set of shareholders that I think are incredibly loyal to this brand,” he said.
“The point that investors have controlled the destiny of this company has been way overplayed.”
Before joining Sears Holdings Corp., where Boire served as chief merchandising officer and president of the Sears and Kmart Formats, he held various retail leadership roles, including as president and CEO of retailer Brookstone Inc. and Toys R Us where he was president of the North American division.
Boire said his experience in those posts taught him about the “ebb and flow” of businesses, which gives him confidence that Sears Canada has a future.
“We’ve had a couple tough years but we have the brands, the people and the customer base to be very successful,” he said. “If we’re focusing on the product and the customer experience, we’re going to do well. That’s what I’m going to work on.”
However, he wouldn’t rule out further store closures in the coming years.
“We’re going to run this business to the best outcome that we can run it and we’re going to make the right and tough decisions if we need to make them,” he said.
In its most recent quarter, Sears Canada lost $21.3 million on a combination of expenses from severance packages and a 6.8-per cent decline in sales.
Last January, the retailer announced it would cut 2,200 employees from its payroll, on top of thousands more that were laid off in 2013. Those actions put a spotlight on the company and raised questions about whether its days are numbered.
Sears Canada has been trying to counter that sentiment, and last week released a video starring Canadian comedian Mike Myers and his brother, a longtime employee of the retailer.
In the scripted exchange, Myers unexpectedly shows up at his brother’s office to ask, “Is Sears going away?”
His brother reassures him that’s not the case, though he concedes, “Sears Canada is getting leaner.”
The clip has amassed more than one million views on YouTube since it was posted about a week ago.
Sears Canada is scheduled to report its third-quarter results on Tuesday.
