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After a difficult year, retailer Signet Jewelers is embarking on an initiative to increase operational and financial performance throughout the company. The three-year ‘Signet Path to Brilliance’ plan is intended to help remedy sales declines in various areas from fiscal year 2018.
This year, the company’s same store sales dropped 5.3 per cent, similarly slipping 5.2 per cent in the fourth quarter. Its total sales were down 2.4 per cent from fiscal 2017, coming in at US$6.3 billion. E-commerce sales, however, provided a silver lining, increasing to eight per cent of annual revenue from 5.7 per cent in 2017.
“Fiscal 2018 was a challenging year for Signet,” said Virginia C. Drosos, Signet’s CEO. “We gained sales momentum in our Zales banner in the fourth quarter as our strategic initiatives began to take hold, but we experienced challenges at our Kay and Jared banners, including execution issues related to the first phase of our credit outsourcing transaction.”
To improve its performance in the coming years, Signet plans to reallocate its spending and pay increased attention to key areas of the business. Its transformation plan thus focuses on improving employee engagement, enhancing the customer experience using consumer insights and data analytics, and increasing e-commerce and omnichannel offerings. The company’s goal is to make e-commerce sales account for 15 per cent of revenue by 2021.
Another component of the plan involves increasing cost effectiveness. To accomplish this, the company will close an estimated 200 stores by the end of next year. Of these, about 75 per cent are located within the same mall as another Signet banner. (In Canada, most Signet stores operate under the name of Peoples Jewellers.)
Through the activities of the transformation plan, Signet expects to save US$200 to $225 million between now and 2021.
