TORONTO -- Sears Canada Inc. (TSX:SCC) chief executive Douglas Campbell said Thursday he will dedicate more resources to the struggling company's online shopping experience and an updated inventory management system.
"Our Internet business is now growing faster than the managed decline of our traditional catalogue business," Campbell told the retailer's annual meeting in Toronto.
Campbell outlined several ways that he aims to boost flagging sales, which weakened 10 per cent in the most recent quarter.
He also said Sears Canada plans to launch an updated "real-time inventory" management system that will help estimate which stores are overstocked on a product that might be in short supply at another location.
"Many of our fundamental systems have to be redone," he said.
Sears Canada is in the midst of a three-year turnaround plan that intensified last year when the company began a more aggressive reduction of staff across its operations to lower expenses, and sold off leases for some of its most prominent locations.
Those actions have raised questions about whether more Sears locations could hit the sales block, though Douglas downplayed those suggestions.
"There's no asset sales that we're actively engaged in now," he said.
Troubles with Sears Canada's financial performance have been heightened by heavy competition across the retail sector. Its workforce cuts have reached across its operations, from call centre outsourcing to downsizing the staff of its warehouses and stripping out layers of middle management at department stores.
Shareholders benefited from the sale of several leases last year when the company paid out a hefty dividend of $5 per share in December.
Nearly half a billion dollars in cash went back to its largest shareholders, U.S. parent company Sears Holdings Corp. (Nasdaq:SHLD) and its controlling shareholder, financier Edward Lampert, who together own 88.8 per cent of Sears Canada's equity.
Since January, the company has announced it will chop 2,200 employees from its payroll, on top of thousands more that it laid off last year. The retailer is trying to reduce costs and improve its overall business. Last year, the company made a similar round of cuts that has lowered its overall employee count to around 20,000 people.
In its most recent quarterly report, Sears Canada said it made a $373.7 million net profit, an increase from $39.9 million a year earlier, largely related to gains from unusual items as the company downsizes.
Campbell said Sears Canada is focused on finding ways to better use its existing store space, which includes a dramatic reduction of its inventory -- which was scaled back by about $76.8 million last year.
A redevelopment of a Sears Canada store in Burnaby B.C. into a mixed residential, office and retail space are being pursued by the company, though they're still in early stages -- making it "too early to tell if conditions will allow the project to proceed," the company said in its annual report.
