Ralph Lauren hires the CFO from Coach amid executive changes
June 10, 2016 10:59 AM
(Bloomberg)—Ralph Lauren Corp. hired the chief financial officer of handbag maker Coach Inc. as part of a bid to reinvigorate the 49-year-old brand with fresh management. The apparel brand also named two other executives with e-commerce backgrounds.
Jane Nielsen will join the fashion house as CFO in September, Ralph Lauren said in a statement Thursday. In addition to overseeing the company’s finances, she’ll handle procurement, store operations, information technology and investor relations. Nielsen will replace CFO Bob Madore, who has held the post for just over a year.
Nielsen’s appointment, one of a series of recent changes, comes two days after CEO Stefan Larsson unveiled his “Way Forward” plan for the company, No. 53 in the Internet Retailer 2016 Top 500 Guide with an estimated $890 million in 2015 web sales, according to Top500Guide.com. The former Old Navy executive is eliminating three management layers, slashing 1,000 jobs and shuttering more than 50 stores. He will also refocus on the company’s three core brands: Ralph Lauren, Polo and Lauren.
Larsson has pledged to react faster to fashion trends and cut down the time it takes to bring clothes to market. He also wants to reduce excess inventory, helping it avoid discounting at department stores and off-price channels. The company said its earnings will suffer until results stabilize in fiscal 2018.
The company also appointed Bill Campbell corporate senior vice president of global supply chain and inventory management. The executive, who has spent the past 11 years at Amazon.com Inc. (No. 1 in the Top 500) in distribution and logistics leadership roles, will start Oct. 1.
In addition, Ralph Lauren named Jeffrey Kuster group president for the Americas. He will oversee sales through wholesale, retail, factory and e-commerce channels, as well as Latin America. His appointment is effective July. Kuster was most recently president of HSN Inc.’s Cornerstone Brands, overseeing home and apparel lifestyle brands that included Frontgate, Ballard Designs, Garnet Hill and TravelSmith. Prior to HSN (No. 25), he was chief marketing and strategy officer at Berkshire Hathaway’s Fruit of the Loom.
Nielsen’s areas of responsibility “all take center stage in the company’s turnaround plan as they provide much of the cost savings and efficiencies needed for margins to recover in the next two years,” said Chen Grazutis, an analyst with Bloomberg Intelligence. It makes sense for the CFO to oversee a broad swath of the company as it works to “flatten its structure and remove blocks,” he said.
Coach (No. 163) has been undergoing a turnaround plan of its own for almost three years. After falling for two years, Coach’s sales have rebounded in recent quarters, helped by new designs, updated stores and last year’s acquisition of designer shoe brand Stuart Weitzman.
Both companies face a similar challenge: “trying to reverse the damages of discounting and recreating profitable sales growth from a lower base,” Grazutis said.
Nielsen, who joined Coach in September 2011, was previously CFO of PepsiCo Inc.’s Americas beverages division and the Global Nutrition Group.
Ralph Lauren gained 2.6% to $96.18 at the close in New York trading on Thursday. The stock is down 14% so far this year. Coach lost 1.5% Thursday.