Key Takeaways:
- Levi Strauss & Co. hired current Kohl’s CEO Michelle Gass as their new CEO.
- Kohl’s stock has struggled all year, leading to Ms. Gass's departure.
- Ms. Gass was not all bad and generated some nice profits for the retailer.
WISCONSIN (CoinChapter.com) — Levi Strauss & Co. announced they had hired Kohl’s CEO Michelle Gass to take over the famous denim company beginning Dec 2.
The move was not a surprise on Levis Strauss’s side as they were looking to replace longtime CEO, Chip Bergh. However, on Kohl’s side, it was indeed out of nowhere.
A Levi’s board member said the company was delighted Ms. Gass will bring her experience and innovation skills to continue building the clothing brand’s long-term future.
Ms. Gass is leaving Kohl’s at a not-so-opportune time as the busy holiday season is in our midst. She spent four years with the retailer, and with each passing quarter, investors became more anxious. Ms. Gass worked hard to boost sales with the Amazon return program and Sephora, but it was to little avail.
Kohl’s Stock Not So Hot in 2022
Kohl’s year-to-date (YTD) stock price has fallen 37.01%; the five-year period is down over 28%. In a preliminary third-quarter report, the company announced last week that sales decreased by 6.9%; quarterly earnings are scheduled to be released on Nov 17.
Activist Investors Played a Role in Pushing Michelle Gass Out
Because the stock price has been progressively dwindling this year, activist investors have tried to get Ms. Gass out. Ancora Holdings, which holds a 2.5% interest in Kohl’s, pushed for a long time to get a new leader so the company could revitalize the business model.
Another high-profile investor, Macellum Advisors, tried to get control of Kohl’s leadership board last year. Macellum’s agenda is the same as Ancora’s – get a revamped board of directors to revitalize the plummeting stock price.
Ms. Gass Had Accomplishments Before Her Departure
Michelle Gass came into Kohl’s with a plan – and to some extent, there were successes. It was her idea to initiate a partnership with Amazon, bringing more customers to the store. Shoppers intending to stroll in for a return very often spent money at Kohl’s on the way out the door.
The biggest plus during her tenure was the addition of Sephora. Kohl’s has 600 Sephora shops, with another 250 planned in 2023. Kohl’s estimates the deal will earn $2 billion in annual sales by 2025.
The interim CEO will be Kohl’s board member Thomas Kingsbury; he will take over immediately upon Michelle Gass’s departure until a replacement is appointed.
Levi Strauss & Co. and Kohl’s Comparison Figures
Levi Strauss & Co. Kohl’s
Employees: 16,600 99,000
Stores: 1,043 1,166
Sales 2Q 2022: $1.517 billion $7.8 billion
Statistics are courtesy of Digital Commerce 360 and macrotrends.
