Dive Brief:
- Grocery Outlet has named two new members to its board of directors and announced that two other directors will retire in August as the discount grocery store operator presses ahead with management changes intended to improve its profitability.
- The new directors include Lawrence “Chip” Molloy, former CFO of Sprouts Farmers Market, and Michael Kobayashi, a former executive of discount department store chain Ross Stores.
- The board changes follow Grocery Outlet’s appointment earlier this year of Jason Potter as its new president and CEO and implementation of a restructuring plan.
Dive Insight:
Grocery Outlet has temporarily expanded its board to 12 directors to accommodate Molloy and Kobayashi, both of whom began their terms on Thursday.
The company said it chose Molloy and Kobayashi as independent members of its board following a national search conducted with help from an outside firm, adding that both will serve on the board’s audit and risk committee.
Molloy was CFO of Sprouts from 2021 to 2023 and prior to that was a member of the specialty food retailer’s board. He has also served in top-level executives roles for companies including clothing seller Torrid Holdings, sportswear maker Under Armour and pet products chain PetSmart.
Kobayashi is currently an advisor to Ross Stores and previously held several positions for the discount retailer, including president and chief capability officer.
The departing members of Grocery Outlet’s board, Kenneth Alterman and Thomas Herman, will both remain as directors until Aug. 7, when the board will return to its previous size, Grocery Outlet said. Alterman has served on Grocery Outlet’s board since 2011, while Herman became a director in 2004.
The decisions by Alterman and Herman to leave the company’s board are not related to “any disagreement with the Company’s operations, policies or practices,” Grocery Outlet said in a regulatory filing.
Grocery Outlet’s disclosure that it is refreshing its board of directors comes at a tumultuous time for the grocer, which has been remaking its leadership ranks as it strives to reverse a slide in profitability, improve its execution and rebuild its sagging stock market value. The company brought on Potter, who served previously as CEO of The Fresh Market, in February.
The company has slowed its store growth plans, laid off dozens of workers and looked to cut costs. It has also seen its share price decline by more than 40% over the past 12 months. In May, Grocery Outlet disclosed that its chief operations officer as well as its chief stores officer would both be leaving the company.
