Dennis Pence, the founder of women’s apparel cataloger/retailer Coldwater Creek, reclaimed the CEO position in late September. He replaced Georgia Shonk-Simmons, who retains her role as president and board member while taking on the duties of chief merchandise officer.
“This marks a return to a structure that worked very well in Coldwater Creek’s corporate history,” Pence said in a statement. “My personal charge is returning the company to our days of rapid growth.” (No company officials would comment on the restructuring.) Shonk-Simmons, a former Newport News executive vice president who joined Coldwater Creek as vice president/director of merchandising in 1998, was promoted to president of the Sandpoint, ID-based company in April 1999; she was named CEO in January 2001.
This type of management restructuring isn’t common, notes Kevin Silverman, a retail analyst at Chicago-based investment management firm ABN AMRO, “but it’s also brave to ignore what your critics might say and do what’s right for the company. Dennis is an ROI-based guy, not a merchant. So when you’re going through losses, I’m not sure that someone whose skills are merchandising can find ways to cut costs and tweak spending and budgets.”
Coldwater’s catalog sales for the fiscal year ended March 2, 2002, were $400.8 million, down nearly 6% from $424.3 million the previous year on a 12% decline in circulation. Overall, the marketer’s sales were flat for its second quarter ended Aug. 31 at $92.8 million. But the company took a $650,000 net loss, compared to net income of $1.3 million for the same quarter last year.
The management reshuffle is Coldwater Creek’s second top-level change this year: Executive vice president/chief financial officer Donald Robson resigned in January; former Arthur Andersen senior partner Melvin Dick replaced him in June. Even with the management overhaul, Coldwater has its work cut out for it. Silverman notes that the economy today is far weaker than it was back in the more robust days of Coldwater’s rapid growth. “And with catalog/Internet sales down over the past year, the company, like many others, is under a lot of cost pressure.