Myer executive chairman Olivia Wirth has engaged Boston Consulting Group to conduct a company-wide review of the department store.
BCG’s report is expected to be handed to the company’s board soon and will be followed by an investor day later this year, according to The Australian.
BCG was tasked with reimagining the department store model and identifying where Myer needs to be positioned in the next five to seven years.
The department store needs to break beyond its average annual sales of about $3 billion, where it has been at for several years.
Myer hit sales of $3.285 billion in its first year as a public company in 2010, and 13 years later in 2023 its sales were $3.36 billion.
Wirth is believed to be seeking to shift the company’s focus to accelerating sales, widening margins, and improving its loyalty program, and has already been discussing with her team ways to improve their women’s wear products range to better compete with traditional rivals as well as new online players.
The BCG report will come as Myer and Premier Investments are considering a major deal. In June, Solomon Lew’s Premier Investments confirmed that it had received a proposal for a potential merger of Myer and Premier’s Apparel Brands.
Under the deal, the combination of Myer with Premier’s Apparel Brands business was proposed via an all-scrip merger – in effect, Myer would acquire Premier’s Apparel Brands business in exchange for the issue of new shares in Myer to Premier.
Myer would acquire the Apparel Brands business which operates 717 stores nationally across the Just Jeans, Jay Jays, Portmans, Jacqui E, and Dotti brands.
Lew, who has a 31 per cent stake in Myer, has for years has been inching towards acquiring a controlling stake in Myer. Wirth’s bold plan will finally deliver the department store to Lew.
The deal, effectively a reverse takeover of Myer, marks the ultimate win for Lew who backed the appointment of Wirth.
Wirth’s decision to hire the BCG has reportedly come with some concern internally that the consultants’ whose fees potentially run into the millions will not really add value to the company’s operations.
Myer will report its full-year results on September 20, and Premier Investments also owns sleepwear brand Peter Alexander and kids stationery chain Smiggle, is expected to issue its annual results soon after.
This article was originally published by Channel News on 9th September 2024. View original.
Photo by Tianlei Sun on Unsplash.
