The company credited the losses to higher interest payments servicing debt accrued during the firm's lean times. I believe that this is a company with a really good brand, excellent real estate and a multi-channel presence. Fettered by growing pains that come with rising from a handful of stores to its current 107, and shackled by heavy borrowings, the company has put the brakes on new store openings, said Friedman. My plan is to not open any new stores but to focus on profitability of the existing business.
Industry analysts have reason to be heartened.
Gordon, who formerly controlled nearly 20 percent of the company he started in 1980, now holds around 12 percent of its shares. Friedman said he expects to eventually acquire around a 10 percent stake, putting him on nearly equal footing with the founder and chairman. Last year, as analyst criticism mounted over flagging profits, Gordon rejected suggestions that he should step aside. While Friedman has proven merchandising skills of his own, one of his challenges will be creating uniformity from the chain's array of products. Among other changes, he plans to bolster the company's catalog business, a move that reads like a page from Pottery Barn's game plan, and add high-margin textiles like window and floor coverings to the product line.