Whole Foods Markets announced a major restructuring of its board of directors yesterday, replacing five of its members in an effort to bounce back from a prolonged slump of seven consecutive quarters of declining store sales.
The Austin, Texas based chain, announced it had appointed Kohl’s Corp executive Keith Manbeck as its chief financial officer, effective May 17. Originally, the plans to remove at least half of its current 12 sitting directors was to take place over the course of the next 12 months.
The retailer also pledged to take on $300 million in new-cost cutting initiatives, including rethinking how it staff stores and building a more efficient supply chain. The company also said it would launch a nationwide affinity program which includes discount coupons for consumers.
“We understand significant change is required at an accelerated pace, “said John Mackey, the company’s chief executive on a call with investors.
Whole Foods has been on uneven ground for the past two years, with a drop in consumer traffic in stores responsible for the largest share of blame. In the most recent quarter, overall transactions were off by three percent, despite increased revenue totaling $3.7 billion. In recent months, the company has toyed with a price-conscious new concept called 365 by Whole Foods---a no-frills and smaller footprint approach to recharge sagging sales.
The new board members include several heavy in retail experience, including Sharon McCollam, formerly Best Buy’s chief financial officer; Ron Shaich, chief executive of Panera Bread and Ken Hicks former chief executive of Foot Locker.
The board shake-up comes on the heels of a stern warning from activist investor, Jana Partners last month, which said the retailer needed to take drastic measures to fix its struggling sales.