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Management Moves at Wal-Mart

NEW YORK — Tom Coughlin’s role as president and chief executive officer of Wal-Mart Stores Inc.’s flagship division has been expanded to include the same title at Sam’s Club, USA.<br><br>Reporting to Coughlin, though also...

NEW YORK — Tom Coughlin’s role as president and chief executive officer of Wal-Mart Stores Inc.’s flagship division has been expanded to include the same title at Sam’s Club, USA.

Reporting to Coughlin, though also carrying the title of president and ceo of Sam’s Club, will be Kevin Turner, who had been the Wal-Mart division’s chief information officer.

Turner will run the day-to-day operations of Sam’s Club.

“Tom [Coughlin] has oversight over all of Wal-Mart and Sam’s Club stores and operations while Kevin [Turner] has the responsibility for Sam’s Club and reports to Tom,” noted a Wal-Mart spokesman.

Tom Grimm, who retired as head of Sam’s Club, passed the baton to Turner on Friday. A tribute to developing talent from within, Turner joined Wal-Mart as an hourly employee in 1986, working his way through several store positions including cashier and customer service manager before becoming chief information officer in 2000.

Sam’s Club has recently lagged the firm’s other major businesses.

Leading the divisional pack in the second quarter was Wal-Mart with sales up 14.1 percent to $38.64 billion. Next came the firm’s international division with a 15.9 percent increase in sales to $9.69 billion. Sam’s Club managed sales of $7.94 billion, a 9.2 percent improvement.

However, the Sam’s Club unit has trailed in terms of operating profits, rising only 3 percent to $275 million during the second quarter. By comparison, the Wal-Mart unit saw a 17.2 percent increase to $3.05 billion, while the international unit’s operating profits leapt 61.9 percent to $510 million.

Overall, the firm’s second-quarter profits swelled 25.6 percent to $2.04 billion, or 46 cents a share, from a year ago. Total sales for the period ended July 31 advanced 13.1 percent, to $60.26 billion, on a 6.4 percent comparable-store increase.

A.G. Edwards & Sons analyst Robert Buchanan, in research notes, said Sam’s Club’s new management should look toward new initiatives “aimed at ‘getting returns up.’” He suggested the division close its pharmacy operations. “We rarely see a lot of activity at the Sam’s pharmacy counter,” he noted.

Buchanan, who has a “buy” rating on the firm’s stock, noted, “Years of successful execution off of its low-cost base of operations have provided Wal-Mart with the joy of having the positive aspect of that single most powerful force of global retailing: momentum.”

Wal-Mart, the world’s largest company, has a habit of nurturing talent from within, so changes at and near the top of its corporate ladder often ripple down its management hierarchy.

Succeeding Turner as Wal-Mart’s chief information officer is Linda Dillman, who had been vice president of international systems development.

Doug McMillon, previously senior vice president and general merchandise manager at Wal-Mart, has been promoted to executive vice president of merchandising for Sam’s Club, succeeding Phil Sutterfield, who has retired. McMillon’s duties at Wal-Mart didn’t include apparel, which is overseen by Lois Mikita and Celia Clancy, senior vice presidents and gmm’s.

Gary Severson has been promoted to senior vice president and general merchandise manager at Wal-Mart, succeeding McMillon. Severson had been vice president and divisional merchandise manager at Wal-Mart.

Shares of Wal-Mart slid $1.06, or 2 percent, to close at $53.19 on the New York Stock Exchange Friday.