Hudson's Bay CEO Gerald Storch steps down to focus on consultancy
Former McKinsey & Company Principal, Gerald Storch, has turned his attention to his own consultancy, following his sudden resignation as CEO of Canadian retailer Hudson’s Bay in October. Hudson’s Bay remains in the middle of a strategic review, having struggled to turn around declining sales under Storch’s stewardship.
Following his resignation from Hudson’s Bay, which took effect on November 1st 2017, Gerald Storch opted to put his more than 30 years of experience in senior management and management consulting to use, by returning his attentions to Storch Advisory, of which he is CEO. The firm, which was founded in 2013, aims to provide a fresh perspective on business and management challenges, as many sectors, particularly retail, face uncertain futures thanks to digital disruption. Storch’s most recent role will have given him unique industry insight in particular, witnessing the global retail giant’s struggles from the inside, due to a rapidly changing retail environment. The retailer reported a bigger-than-expected loss in its second quarter.
In a bid to utilise innovative digital technology, rather than be surpassed by online competition, as CEO, Storch drove the acceleration of Hudson’s Bay’s all-channel ecommerce business model, which encompassed Saks Fifth Avenue, Lord & Taylor, Gilt, Saks Off 5th, Hudson’s Bay (Canadian and Dutch market leader), Galleria Kaufhof (Germany) and Inno (Belgium). Prior to this, he also spent a brief 10 month stint as Chairman and CEO of Toys’R’Us, where Storch led a resurgence of the business and grew the company into a $13 billion global retailer – expanding the company’s ecommerce business to over $1 billion, and pushing for international growth into China and throughout the world, while overseeing large-scale mergers and acquisitions that included the purchase of FAO Schwarz, eToys and KB Toys. He also served as Vice Chairman of $70 billion retailer Target, a company he spent over a decade with.
A Master of Business Administration, having studied at Harvard Business School before stepping into the retail world, Storch was a Principal at McKinsey & Company from 1982 to 1993, leading consulting projects for a number of Fortune 500 companies during his time there, counselling clients in both consumer goods and financial services. Now, he returns to the consulting industry, having stepped back from Hudson’s Bay.
Following his surprise resignation, Storch said in a statement, “I have great confidence in the company and the executive leadership team’s ability to take the right actions to position HBC for leadership in the retail industry.”
Storch’s departure is the latest in a growing senior exodus from the company. Paul Beesley left his role as Chief Financial Officer in May this year, while Brian Pall, the long-time Chief of Real Estate, left in June, ahead of the Head of International Business, Don Watros’ exit in September. The resignations come as the company remains under pressure from activist shareholder Jonathan Litt to take steps to improve stock performance. He has suggested various options to extract value out of the company’s $10 billion worth of real estate assets, including reported plans to take the enterprise private. Former HBC CEO Richard Baker, now the executive chairman, will serve as the interim CEO while the company searches for a replacement for Storch, said the company.
Commenting on the sudden loss of Storch, Joshua Varghese, a fund manager at CI Investments, HBC’s sixth-largest shareholder, said, “The CEO exit creates uncertainty around the company’s plan at a time when shareholders need more answers than questions. It’s extremely abrupt. It’s further evidence that shareholders need to see a strategic plan.”
