S&P also has added that it might push the bond rating to junk status, if the retailer cannot steady the ship amidst fierce competition from e-commerce and discount retailers. In January, rating agency Moody’s downgraded the rating to Baa2 (two levels above junk) for the company.
The retailer is struggling with declining same-store sales and rising expenses, resulting in lower margins. It also failed to tackle the onslaught of online retailers apart from its traditional peers. CEO Steven Temares and his team have a daunting task at hand.
It’s high time for the firm to look at closing down stores which aren’t making money, getting the right product mix in its stores, and improve the digital experience for users. Experts also have been pointing to the fact that it’s operating under too many different brand names with hardly any differentiation on the products or customers they are catering to. It’s a classic case of problem of plenty!