Ralph Lauren's CEO is taking a look at what went wrong regarding his company's holiday sales.
Citing that the apparel retailer suffered a 39 percent drop in quarterly profit during that period, leading to a scaling back of its sales forecasts for 2016, The Wall Street Journal reports that Ralph Lauren Chief Executive Stefan Larsson is undertaking a review of every facet of the business to identify growth opportunities and expects to complete the process by late spring.
Among the issues being reviewed, WSJ posits, may be what some analysts view as a lack of focus at Ralph Lauren, given that the retailer's practice of selling a wide array of labels is arguably inefficient from a production standpoint and potentially confusing to consumers. Furthermore, the outlet shares that Larsson is also examining his company's pricing and distribution strategies, citing that Ralph Lauren's business with department stores, like Macy's and Nordstrom, has suffered in concert with those chain's struggling sales.
According to WSJ, Larsson is considering improving inventory management — keeping stock at more manageable numbers to avoid the necessity of marking down prices — as a potential solution to the latter problem.
Revenue for Ralph Lauren, shares the outlet, fell from $2 billion for the three months ending Dec. 26 in 2014 to $1.9 billion for the same period last year, amounting to an overall revenue drop of 1 percent. Though the company forecasted in November that sales would increase by as much as 2 percent, it hasn't recorded a quarterly sales increase since March 2015.
“While our recent results have been disappointing, I am greatly encouraged by the changes that are already taking place since the appointment of Stefan Larsson as our new CEO,” Executive Chairman and Chief Creative Officer Ralph Lauren said in a stament shared by WSJ.