C&J Clark announced last month that Melissa Potter, chief executive of the group, and Robin Beacham, chief financial officer, are stepping down from their roles with immediate effect. Thomas O'Neill, non-executive chairman, will act as executive chairman pending the recruitment of a new CEO. Beacham's functions will be taken over on an interim basis by Clarks' financial controller, Mike Coley.
Like other media, we could not obtain an explanation for the move, but it was likely due to the company's disappointing results for the first half ended on July 31 (see the next article in this issue). In its public statement, Clarks' board of directors acknowledged the contribution made by Potter and Beacham to the internationalization of the 190-year-old group. It added, however, its belief that “new leadership will help us to meet and overcome the challenges ahead” and to fulfill Clarks' potential to become a “truly global leader” in the footwear market.
The board mentioned that the company has been experiencing “a highly demanding commercial and economic environment, with increasing competition and intensified customer expectations.” It defined the recruitment of Potter's successor as a priority. Meanwhile, members of the executive team will be given new responsibilities, reporting to O'Neill.
Potter, who started at Clarks as a trainee in 1988, was chosen over other candidates to fill the CEO's role five years ago, taking the place of the retiring Peter Bolliger. She had previously run Clarks' wholesale operations in the U.K. and the international business. After running Clarks' North American operations since 1992, Bob Infantino quit the company shortly after her nomination, and the region has been a problem area for the group ever since. On the other hand, under Potter's management, Clarks' overall sales outside the U.K. increased from 48 percent to 57 percent of the total turnover, with strong increases in Europe and the Asia-Pacific region.
Under Potter's management, Clarks' total sales rose from £1,281 million in 2010/11 to £1,492 million (€2,020.1m-$2,264.0m) in the latest financial year, ended on Jan. 31, while net earnings went from £77.1 million to £94.7 million (€128.2m-$143.7m). We could not obtain the results for the first half of this year, but in the past year, sales were down by 3.2 percent from the year before, with declines of 0.1 percent in local currencies and 2.1 percent in the number of pairs sold.
The company's board of directors has formed a “governance sub-committee” made up of O'Neill, Nigel Hall, a senior independent director, and Hugh Clark, a non-executive director who represents the family that controls the company.
In Clarks' financial report for the first half of the year, O'Neill said the board was in the process of identifying three new independent, non-executive directors “with specific skills” to supervise the company's growing business. They would take the place of three members of the board once their service terms expire.
O'Neill said that Clarks plans to reappraise the model it has adopted for developing the European market, following disappointing results in the first half of this year. The company's chief commercial officer, Steve Finlan, will re-focus investments in the U.K., Ireland, the Americas, China and India, which are regarded as the most important strategic markets.
Clarks will also accelerate investments in e-commerce to extend its reach more fully across the group. The company's new global e-commerce format had a successful start in the Americas in February. It is due to be implemented also in the U.K., Ireland and the rest of Europe in 2016.
The new management will investigate opportunities to simplify its activities. Meanwhile, the company wants to accelerate product development and concentrate on other consumer-facing activities now that its global SAP platform has become operational.
Aided by Clarks' new chief brand officer, Jason Beckley, the new management team will conduct a strategic review of the brand's positioning and its product strategy. O'Neill said his priority will be to re-focus the brand on its core consumers and core categories of premium classic casual shoes for men and women, plus school and everyday shoes for children. The product offer should be simplified, with a stronger focus on the most profitable categories, starting with the spring/summer 2017 collection.
Beckley was appointed to the new position of chief brand officer in July to strengthen brand-building activities and to make them more fully integrated with sales and marketing. He came to Clarks after working for Puma, Nike, Alexander McQueen and Ralph Lauren.