Putting VVTV in the same conversation with Amazon is a humongous S-T-R-E-T-C-H. VVTV ever contemplating the purchase of Amazon is a flat out joke. BTW, Amazon only loses money because Bezos is constantly pushing the company into new ventures. Their basic retail business makes money.
It's what I've been saying all along is the biggest problem of this mgmt. They don't have any idea or plan on how to attract meaningful new brands. The brands they need are locked up by Q and H and so Shop runs re-runs. He had 5 years to figure it out. He deserved to be whacked.
If you understood what his motivations have been since the beginning, you wouldn't be surprised by his selling shares. All he ever wanted was the power and position of being CEO and making $50M just like the former CEO at QVC did. Period, end of story. Now he has neither and trust me, it's eating him alive. Of course he'll tell people that he's laughing all the way to the bank with his $5 - $10M that he took from Shop. But getting thrown out for incompetence and missing out on the real #$%! you money is killing him.
retailexecutive, your name is appropriate. You understand the basics of the retail business. For a CEO to lay blame for an entire disastrous quarter on an electronics supplier is bush league stuff made worse by the fact that the CEO grew up for 20 years as a buyer and DMM in the consumer electronics business. That just shows you how incompetent he was. If he couldn't adequately oversee a business in which he spent 20 years in, how in heaven's name can he be a CEO?????
I have to disagree with you Trump. When the new CEO, himself, promises publicly on an earnings call, that he is going to double the business from ~$500M to ~$1B in 3 to 5 years and he misses by $400M, that my friend is a failure. C'mon, you can do it, put your top teeth on your lower lip and say it - FAILURE! With a capital F.
Hey, all I said was the current leadership had been a failure and had to go and the CG team had the background and experience to offer qualified leadership. In fact I said "whether the new team is successful remains to be seen."
Regarding trending brands/items like GoPro - Q, H and S all sell to essentially the same "type" of customer and what separates them is the products they offer and the way in which they present those products i.e. quality of hosts, sets, props, production values. GoPro doesn't get any different customer by going to Shop HQ, they just get a poorer representation of their brand and 1/10th the sales for the effort.
You unwittingly hit the problem nail on the head. Why in the world would GoPro give ShopHQ an exclusive launch? Everybody knows QVC sells 10X whatever Shop sells. Not an easy problem to solve which is why they need someone with real vision and leadership.
Trump, all true but you leave out the most glaring lack of ability, that of being unable to re-merchandise the business out of Jewelry/Watches and into more appropriate and better TV selling categories. No one there had that ability and THATS why their sales lagged. The show looks like amateur hour and the merchandise mix is all wrong. This is retail and the most important element by far is the products you sell.
While I respect your opinion rsparker23 and note that you seem a level headed commenter, I would disagree with you on the outgoing mgmt team's efficacy over the past 5 years. I assume from your comments that you have been in business, either for yourself or as a corporate executive, as I have for the past 30 years. I will tell you from my experience, it is much easier to take over a floundering business than one that is riding high. This team had middle mgmt experience at Q. Walking into ShopNBC 5 years ago, it was certainly clear to them what was broken and how to use their Q experience to fix the broken basics. It would be far more difficult to take over H or Q right now after decades of continuous growth and profitability. There are no "low hanging fruit" that KS and team had the opportunity to pick 5 years ago. They did an acceptable, workmanlike job plugging the visibly leaking pipes, but to get to $1B, the company needs stronger vision and leadership even though their is still some low hanging fruit that this team couldn't figure out how to grab. And honestly, while Bozek is not a CEO on training wheels as KS was, I'm not sure he is visionary enough either. We'll see.
The comments from me and retailexec are true. They are not heresay. They come from people directly involved with the business at Shop. Q has an organized, long term process in place to put shows and big items on their calendar. Sure, things change occasionally went business warrants it, but at Shop, the word from not one or two people, but many that are involved in the business, is that scrambles to place major promotional items regularly occur days or weeks before the event which drives the entire buying team and vendor community into chaos. Senior mgmt doesn't want to hear anyone, buyer or vendor, disagree with their strategies or tactics. Talk to the people there. It's a mess.
Like it or not, retailexecutive is correct. It's not conjecture or speculation. All precincts - company executives and vendors - report the same situation inside the company: lack of a merchandising plan, last minute changes to item programming, dearth of new vendors and merchandising ideas, obscene language and 4 day workweeks. It's the few of you here on this board that are in your own little hopeful echo chamber.
Yep. Mgmt and most of the BoD, gone! Stock up 7%. You can't go through dozens of earnings calls where you talk in circles, saying nothing of substance, then miss your own sales projections by a country mile and expect not to get whacked. They need real leaders to run this company not passed over middle managers from Q.
Jewelry/Watches do have higher margins than Home but also have much higher return rates. Plus, price of gold has hurt the business over the past few years. Q doesn't do Watch business except for proprietary brands and some fashion brands that might offer a watch as part of their collections.
As far as signing new big name brands in categories that work on TV, they've been trying for years but those brands have huge businesses with Q and H and they will not jeopardize those business relationships in order to get an order from Shop that's 1/10th the size of Q's orders. This is why you don't see very many big names on Shop. They don't have a strategy to attract them either.
Trump, you and I have different and views about how to define acceptable "sales growth" for this company. Yours is subjective, mine isn't. Mine is objective based on what HE HIMSELF PROMISED 5 years ago. No one put a gun to his head. He actually believed he would double the business in 5 years and so, by their own explicit pronouncement, they have failed. You're just a very patient guy - I and the CG group are not.
And regarding Jewelry/Watches, I don't recall what that penetration was 5 years ago, and believe me, I understand that you can't just turn off that spigot all at once and not drop a ton of volume, it has to be done over time and with a plan, but they have had 5 YEARS to get that number where it should be but it's still nearly 50% of their business (Q is under 15%). So where is action? Where is the urgency? Five years and they are still the butt of everyone's joke as the Invicta station.
Good luck with that. Don't hold your breath. Honestly, do you really expect them to outline a plan to deliver what he promised 5 years ago? You'll hear the same circular conversation on how they are well positioned and have made great advances in the business, etc. etc. The fact is they really don't know how to get out from under their current merchandising mess of Jewelry/Watches. After 5 years those categories still represent nearly 50% of their business. They don't have the ability to create meaningful proprietary brands, they can't attract important national brands in categories that matter to a TV shopping channel due to their implicit exclusivity with Q and H. What you need them to do is to "name names". What specific national brands (to deliver new customers that don't shop on TV) and proprietary brands (to deliver exclusivity and higher margins) are they going to sell, and when, in order to get the correct merchandising penetration? What specific changes are they going to implement to reduce Jewelry/Watches from 49% down to a goal - Q is under 15% - of say, 25%? How are they going to maintain sales growth while to reduce the Jewelry/Watch business? How are they going to fund a more professional looking set design?
All of your EBITDA and PPS conversation is built on the foundation of the answers to these questions which is to say - it's all based on sales increases.
rsparker, Trump is not emotionally attached to the mgmt team, he just has an unbelievably low bar of performance expectations. Trump and others seem perfectly OK with WAITING for this ship to come in. It's been FIVE years! That's a lifetime in a retail business, in any business for that matter. Did you read this in CG's letter this morning? Are you kidding me?
This mgmt team is a bunch of middle managers and simply not capable of running a public company.
-- "On May 1, Mr. Stewart had an 11 AM appointment with a sell-side research analyst who was considering picking up coverage of the Company. We are told that Mr. Stewart showed up some thirty minutes late and apologized by saying he was "fishing" and did not want to leave the lake because the "fish were biting." And, of course, because May 1 was a Thursday, if it was like most Thursdays, many on the management team left in the early afternoon to catch their flights back home – to Pennsylvania, Florida, Texas and the other places where as many as 10 senior managers spend their Fridays (and many Mondays). Usual for ValueVision is quite unusual."
I've been in the retail business for over 30 years and I have certainly missed a sales or inventory projection here and there. However, I was not the CEO and I didn't miss over a 5 year period of time. It's ok to miss occasionally, but you have to get back on plan quickly. And, if you put out a 5 year plan, you better at least come close to it. This guy has missed by a country mile! And he doesn't have much time to make good on his promise (made several times BTW) because it was March 2010 when he spouted off "double the business in 3 to 5 years" and now you're hanging your hat on the hope that he can still pull that off between now and Feb 2015 (not Feb 2016 - check YOUR math my remedial friend). Good luck with that!!!
No personal issues here. In my business, for 30 years, you set goals and accomplish them or you get shown the door. It's that simple. In 2010, he said "double the business in 3 to 5 years." Look it up bozo.
Trump, in March 2010, he said, quote: "We fully expect to double our business over a three- to five-year period.”
Even if you give him the 5 years, his projections are bush league throw-a-way prayers.
Of course they have rsparker. Running this company is their chance to cash in. Self preservation my friend is a very potent elixir. I believe that Mr. Trump is letting them off the hook way too easily, explaining away all the failed promises and lack of aggressiveness. Remember, the small sales gains they have made over 5 years INCLUDE millions of new FTEs. That's like a brick and mortar retailer adding 10% - 15% percent more stores and growing a few percentage points. Not good enough and certainly a universe away from his own proclamation to double the business in 3 to 5 years.