Country Road Group has triggered an executive restructure and redundancies as sales slump
Country Road Group, caught in a workplace sexual harassment scandal this year, has made sweeping changes by restructuring senior positions, announcing redundancies and creating new roles.
Business
Don't miss out on the headlines from Business. Followed categories will be added to My News.
Country Road Group has pushed through a restructure and clean-out of its senior leadership teams, especially at its flagship Country Road brand, as it seeks to improve its online presence and reposition all the fashion and apparel brands within its stable.
Announced to Country Road Group staff at its headquarters in Melbourne on Wednesday, chief executive Raju Vuppalapati said the restructure and redundancies were part of a crucial step in transforming the business to achieve its vision of being “the most admired Australian lifestyle house of brands”.
The restructure creates new executive roles such as a “head of raw materials” to better source fashion fabric for its range, and a “general manager of strategic sourcing” to improve its procurement of supplies and better prices to push down on its costs of goods.
The redundancies have particularly affected Country Road. The Australian has been told key executives who were made redundant include its general manager of apparel and accessories, the head of retail, head of marketing, head of digital and head of visual merchandising.
It is believed there will be more redundancies within Country Road as well as elsewhere in the wider company over coming weeks and months.
Mr Vuppalapati is keen to bolster the fashion house’s supply chains, merchandising, advertising and customer service as well as ramp up its online and digital credentials – and hopes these will arrest the retailer’s sagging performance.
The fashion house, owned by South Africa’s Woolworths Holdings, recently reported a 66 per cent slump in adjusted operating profit of $51.3m for the 53 weeks to June 30, as sales fell by 13 per cent.
Country Road Group, which this year was embroiled in a sexual harassment and bullying scandal at the same time as sales and earnings dived, has decided to manage each of its brands – Country Road, Trenery, Mimco, Witchery and Politix – separately.
The restructure and redundancies follow a staff meeting this month during which Mr Vuppalapati lamented the poor financial performance of the retailer – which he described as its worst in its corporate history – and pre-empted executive and operational changes would be announced.
“Earlier this month the executive leadership team and I shared with you our plans to transform our business to achieve our vision of being the most admired Australian lifestyle house of brands,” Mr Vuppalapati said in a staff email obtained by The Australian.
“Our new operating model is designed to enable all team members to contribute to our future success.”
Under the changes all brands within Country Road Group have been repositioned to focus on growth and each brand will now be managed separately.
Within the five Country Road Group brands the company will invest in new buying teams which will concentrate on “understanding trends, building product assortments and leading trading plans aligned to our customers’ needs,” Mr Vuppalapati told staff.
These teams will be led by a head of buying within each brand, except for Politix.
A new role has now been established within Country Road Group – general manager, retail, who will form part of the executive leadership team.
The head of retail, head of real estate and a newly created head of retail operations will report into this new role. As part of an elevated e-commerce presence a new group head of e-commerce role has also been created.
Earlier this month Mr Vuppalapati also spoke to staff about the importance of improving Country Road Group’s sourcing capabilities and supply chains, and to fuel this he has created three new roles to develop, procure and deliver the best fashion and apparel products.
These three new roles are general manager strategic sourcing and procurement who will drive supplier strategy and cost of goods savings, a general manager supply chain to be accountable for realising end-to-end optimisation opportunities and a head of raw materials who will lead a team of core fabric experts and support design and production teams.
A new head of strategy and transformation will report to Country Road Group’s chief financial officer, Rosetta D’Amico, to help deliver on key strategic priorities.
Mr Vuppalapati said in the staff announcement that his leadership team would begin “team member conversations” from November 11, and it is expected that this will lead to further redundancies.
In June, The Australian revealed that Country Road Group was engulfed in a sexual harassment and workplace scandal. It saw two highly placed executives suddenly depart and the global boss Roy Bagattini flying to Australia to address staff to announce an external investigation into the handling of complaints at the retailer’s Melbourne headquarters.
More Coverage
Originally published as Country Road Group has triggered an executive restructure and redundancies as sales slump
Join the conversation
WiseTech’s board confronts tough choices with its key man
The billionaire founder of WiseTech Global, Richard White, has the backing of his board but there are active discussions about the chief executive taking leave from the tech major.
Read more
KPMG Australia an AI ethics pioneer
The consulting firm has become the first organisation in the world to be awarded a new certification the not only ensures AI’s safe use but audits its carbon footprint as power-hungry data centres come under fire.
Read more