Gordmans Stores president and CEO Jeff Gordman has resigned his post. According to the company, he is retiring to spend more time with his family as well as to pursue outside interests. Board chairman T. Scott King will serve as interim CEO while the company searches for Gordman’s successor.
King will work closely with the company's current management team and board of directors to oversee the company's ongoing planned initiatives on a full-time basis. He will take an unpaid leave of absence from his position at Sun Capital Partners during his service with Gordmans.
King has 30 years of operating experience in the consumer, industrial and retail marketplace. He is a senior managing director with Sun Capital Partners. Prior to joining Sun Capital Partners in 2003, King was CEO of Waterlink, a manufacturer of water treatment systems, and was president of the $1 billion consumer brands division of the Sherwin Williams Company from 1992 to 1998. King graduated from the State University of New York at Oswego with a bachelor of arts degree in business and serves on the board of advisors of its business school.
Gordman, whose great grandfather founded the predecessor company nearly 100 years ago, joined the company in 1990 and has been president and CEO since 1996. At that time, the company operated 32 stores generating annual sales of more than $200 million and net losses of several million dollars. Gordman is credited with leading a complete repositioning of the business, overhauling the merchandising, marketing and stores strategy, developing a store prototype growth vehicle and changing the store trade name from Half Price Store to Gordmans, which was completed in fiscal 2000.
Gordman sold the company to Sun Capital Partners, one of the largest private equity firms in the country, in September 2008, continuing on with the company as president and CEO to lead a successful initial public offering of common stock for Gordmans in 2010 as well as a secondary public offering in 2012.
During the last three years, Gordmans has expanded its store base by nearly 40%, and today employs more than 5,000 associates operating 95 stores in 55 markets and 20 states. For fiscal year 2013, Gordmans revenues were $620 million.
Last week the company opened three of seven planned new stores this year in Michigan, Indiana and Idaho, and this July will open a 545,000-sq.-ft. distribution center facility in Indianapolis, which will enable Gordmans to service more than 200 stores.
"I am very proud of our fantastic team and what we have accomplished over the past several years," said Gordman. "I am leaving a company that is very well positioned to capitalize on innumerable growth opportunities going forward. It has been a true honor to lead such a talented management team and so many highly engaged associates who are passionate about delighting our guests."
News of Gordman’s departure comes as the company reported a net sales increase of 2% for the fourth quarter to $200 million, compared to $196.2 million in the prior-year period.
"Our fourth quarter sales performance was driven by the ten new stores that we opened throughout the fiscal year, partially offset by a comparable store sales decline of 7.4% on a comparable calendar basis," said CFO Mike James. "While we are disappointed with our results in the fourth quarter, sales were disadvantaged by six fewer shopping days between Thanksgiving and Christmas this year. In addition, weather had a negative impact in December and January. During the past several years, we have increased our store count by more than 40%. We have also accomplished a number of strategic initiatives to prepare the Company for continued growth, including implementation of a new Oracle enterprise merchandising system and a new business intelligence system, launch of our gRewards loyalty program and, in 2014, we recently completed a headquarters office move and we are in the process of completing our second distribution center and the re-engineering of associated business processes."
Since launching its gRewards loyalty program in the second quarter of 2013, the company has enrolled approximately 1.5 million customers as of the end of fiscal 2013 and the average loyalty transaction has equated to a double digit percentage increase over the average non-loyalty transaction.