Pier 1 taps former Kmart chief as CEO

Dive Brief:

Pier 1 Imports on Monday tapped former Kmart chief Alasdair James as president and chief executive officer of the company, effective May 1. He will also join the board of directors.
James had most recently served as president and chief member officer of Sears Holding Co.’s Kmart unit since 2014, but left in March, becoming the third high-profile Sears Holdings executive to depart within the last three months.
While the home decor retailer has struggled in recent quarters, it punched up sales and profits in its third quarter after closing 33 stores last year and making changes at its remaining ones.

Dive Insight:

Improvements to stores and supply chain savings helped sweep Pier 1 to more positive territory late last year, prompting Neil Saunders, GlobalData Retail managing director, to note then that the retailer ”is now on a much more positive trajectory.”

James is joining Pier 1 just as it is gaining some momentum, and his experience is well suited to the company’s needs, chairman of the board Terry E. London said in a statement Monday. James joined Sears Holdings after serving as commercial director of global business at U.K. supermarket chain Tesco, and one of his duties was to boost Kmart’s customer-centric Shop Your Way loyalty program. In all, he has some 15 years of retail and consumer goods experience in the U.S., U.K. and China, according to a company press release.

Former CEO Alex W. Smith announced his planned departure in September, and he officially stepped down at the end of 2016. In the company's fiscal second-quarter report, London gave Smith props for boosting the retailer’s e-commerce business, which was more or less non-existent when he took over 10 years ago. E-commerce in the latest quarter boomed 28%. But Smith's initial turnaround gains gave way to continued sales struggles last year. Upon Smith's departure, London took over as interim CEO.

Going forward, Pier 1’s challenges include further improvements to merchandising, especially in furniture, in which Saunders said the retailer “punches well below its weight.”

“In our view Pier 1 deserves some credit for the changes it has been making," he said in a December note. "These margin gains have been augmented with further uplifts from savings in the distribution network, most notably the transport of goods from Asia."