Target MD Launa Inman is to step down as the retailing giant comes under increasing trading pressure following earnings nosedive and drooping sales.
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The shock resignation at the top of one of Australia’s biggest retailers after seven years comes as Inman “felt the time was right time to move on,” according to a statement put out by Wesfarmers group today.
However, the Managing Director insists suggestions of poor results pushing her out were off target.
“There is absolutely no correlation of the results with why I am leaving,” she told various media today. “The timing is right for me and for Target that I now transition out of the business.”
This comes as “erratic trading” forced sales to fall 1.2% to $3.8 billion for the recent financial year, announced in July, although total sales increased 2.9% to $897 million in Q4, its most recent quarter.
Pre tax earnings also nosedived 27% year-on-year and Inman also forecast trading to continue to be difficult into the first half of the next financial year.
The red dot retailer also moved its wares on-line, focusing on children’s apparel, baby and nursery items and selected bathroom ranges with additional categories “to follow”, as well as a revamp of instore format.
Underperforming lines including DVDs and music are also to be reduced due to increasing online competition, with rivals like Apple’s iTunes and JB Hi Fi’s newly announced ‘Now’ offering streamed music instantly from a library of 10 million songs.
Take the Ugly Truth DVD movie starring Katherine Keigl, which selling at Target for a competitive $12.99 – the identical price JB Hi Fi.
However, the key difference is the same release is available for online purchase with free delivery from the yellow retailer’s online store, which by the way has over 800K weekly visitors.
The same movie is available for download on iTunes for US$9.99. Thats the real ugly truth for Target’s suffering brick and mortar business.
Read JB Hi Fi Looking At Movie & TV Streaming Here
In a presentation given as part of 2011 results announcement last month, Inman forecast “a challenging & competitive trading environment expected to continue into FY2012.”
She also cited future strategies including “broadening customer offerings: increased use of digital technology (on-line & use of social media); launch of first Urban by Target” and refinement of product presentation in-store” as among her priorities for the year ahead, prior to her resignation.
However, this is not the last stop for Inman, it appears, who is on the lookout for another retail role, however, with a possible move to more upmarket Myer being mooted by media reports today.
”My plans aren’t really set,” she said. ”What I do know that after being at Target for seven years I really don’t want this to be my last stop.
”I just felt that after seven years it was time for me to try something different”, the former Telstra Australia Business Woman of the Year ex Officeworks boss declared.
Inman, who steered Target’s integration into the Wesfarmers following its takeover of the former Coles business in 2007 will remain in her role until a replacement is found, expected to be early 2012, and is confident for Target’s future, nonetheless.
“I feel privileged to have been given the opportunity to lead Target and I am very proud of what the team and I have achieved together during my time as Managing Director,” she said.
“Target has been an incredibly successful retailer for many years.
“I am very confident that with the quality of Target’s senior management team and the plans now in place, Target is set up for success.