Supervalu embarks on IT transformation
Eager to strengthen operations across its enterprise, Supervalu is moving to the cloud.
Through a strategic relationship with Sungard Availability Services (Sungard AS), the grocery company is replacing its mainframe technology infrastructure with a new mainframe platform that will offer cloud, back-up, and other solutions and services. The new configuration is designed to improve operations across the independent retailers it supports.
Together, the two companies will replace Supervalu's legacy mainframe IT environment under a transformation program aimed at reducing costs, improving flexibility, and supporting service to its network of more than 2,000 grocery stores. This transition will enable the company to use technology smartly and better compete in an increasingly demanding and competitive grocery environment.
Through the agreement, Supervalu will upgrade the technology without requiring an upfront investment. It also offers Supervalu an opportunity to move many of its workloads into a secure, highly-scalable cloud platform. The company will also replace fixed-cost, in-house equipment with variable-cost services that can be scaled as needed. The platform enables Supervalu to also deliver a full suite of Sungard AS cloud and recovery services to its retailers.
"We plan to strengthen operations across our enterprise and add shareholder value by transforming our approach to technology," said Chad Mead, CTO at Supervalu. "Technology has become an essential factor in competing in this market, and our planning with Sungard AS suggests that we can build a more flexible and responsive mainframe infrastructure that drives growth."
Luxury department store retailer shelves sale
Neiman Marcus Group is going it alone — at least, for now.
Neiman Marcus on Tuesday posted a disappointing quarter in which it posted its fourth consecutive quarterly loss. The luxury fashion retailer also revealed that it is no longer in discussion with Hudson's Bay Company regarding a possible sale.
"We previously announced that the company was exploring strategic alternatives," chief executive Karen Katz said on the retailer's earnings call. "However, at this time, any conversations regaring a partial or full sale of the company have been terminated."
Neiman Marcus' total revenues fell 4.9% to $1.11 billion in the third quarter, ended April 21, down from $1.17 billion in the year-ago period. Same-store sales decreased 4.9%.
The company reported a net loss of $24.9 million for the quarter. This compared to net earnings of $3.8 million for the same period last year.
In March, Neiman Marcus announced that it was exploring options. The company is under pressure from a heavy debt load, much of which stems from its $6 billion leveraged buyout in 2013. The retailer is also challenged with declining sales due to increased online and fast-fashion competition.
Sears cutting jobs; key digital exec to leave
Sears Holdings is reducing headcount as part of its ongoing effort to deliver $1.25 billion in annualized cost reductions. It's also losing a key online executive.
Sears is eliminating some 400 full-time jobs at its corporate offices, in Hoffman Estates, Illinois, and from its support functions. In addition, certain positions at the chain's field operations will be impacted. The eliminated jobs represent less than half a percent of the 140,000 full-time and part-time employees Sears had as of the end of January.
In other news, Stephan Zoll, president of online, Sears Holdings, is stepping down from the company, effective June 15, Sears said Tuesday in a separate 8-K filing with the Securities and Exchange Commission. Stephan joined Sears in June 2016, coming from eBay Germany where he had served most recently served as VP of eBay Marketplaces.
As previously announced, Sears' strategic restructuring program is designed to deliver $1.25 billion in annualized cost reductions. To date, the retailer said it has made about $1 billion in annualized cost savings to date, and remains on track to meet its target.
"We are making progress with the fundamental restructuring of our operations that we initiated in February," said Edward S. Lampert, chairman and CEO of Sears Holdings. "We remain focused on realigning our business model in an evolving and highly competitive retail environment. This requires us to optimize our store footprint and operate as a leaner and simpler organization."
Last week, Sears confirmed that it planned to close 66 additional locations on top of the 180 planned closures it had announced earlier in the year.