Yahoo Inc. managed to find a new CEO in under two months. Sears needs a new CEO, too, but they’ve got an interim CEO until they find one. Children’s Place is also searching for a CEO, and operating with an interim CEO while they interview qualified candidates. Barneys, on the other hand, has been without a CEO for more than a year. They have no interim CEO. And no prospects. But that’s okay, because they have seven vice-presidents playing CEO together. And even without them, the company could practically run itself, right? Because it’s not like they’re having all sorts of problems, you know, paying vendors or selling merchandise or maintaining stock at a desirable investment grade. Kidding! All of those things are problems! Barneys is a mess, and not having a CEO doesn’t help.
Barneys’ last CEO, Howard Socol, left the company more than a year ago owing to strategy differences with then-new owners Istithmar World. A few months ago, reports began surfacing that retail lenders were refusing to give money to Barneys, preventing shipments from landing in stores. Without these funds, retailers have to pay deposits upfront or cash on delivery for shipments of new merchandise. So Istithmar injected $25 million into the chain in April to ensure they would have inventory. And also to attempt to restore the lenders’ good faith.
Now if Barneys had had a CEO, the whole mess with the lenders might not have happened. Lenders could have gone to the CEO — the single person in charge — and been like, “Hey! You guys owe us money! Also, we’re kind of not sure that you’ll be able to pay us in the future — or survive at all, for that matter — so if you could give us some reassurance with charts and graphs and a pat on the back and stuff, that would be great.” But alas, there was no one person to talk to, and Istithmar had to throw a bunch of money at Barneys to get the ball rolling again. Lenders have since resumed doing business with the company.
The lack of a CEO has also hurt the chain’s credit rating. In April, Standard & Poor lowered Barneys’ credit rating to CCC, or “distressed debt,” which falls a whole eight rungs below investment grade. This is because, without a CEO, Standard & Poor can’t tell what direction the company will take.
Someone close to the situation says Barneys found a good candidate for a CEO late last year, but never made that person an offer. What — did everyone shove off to St. Moritz together for skiing and hot chocolate and forget? Anyway, the board of directors is meeting today. According to the Journal, they probably won’t talk about finding a CEO.