No Bonuses for Most Retail Executives as Sales Decline in 2017
2017 has been a tough year for retail, to say the least. CNBC reports more than 5,400 retail store closures have been announced this year so far, up 165 percent from 2016, with 10 major retailers filing for bankruptcy. In a new report from retail recruiting and organizational consulting firm Korn Ferry, 73 percent of larger retailers in North America paid little-to-no bonuses to executives for last year's performance, and 35 percent didn't pay any bonuses at all. It's quite the contrast from 2013, when only 10 percent of senior retail executives were left out of the bonus pool. Abercrombie & Fitch, Express, GNC Holdings, Rite Aid, and Stage Stores are among the retailers that didn't pay their CEOs bonuses in 2017.
Total Retail's Take: In a pay-for-performance industry, fewer and fewer retailers are rewarding their executives with bonuses. "What the trend reflects is that the business is getting tougher," said Craig Rowley, senior partner at Korn Ferry, in an interview with CNBC. "Retailers are setting plans they aren't able to achieve." However, when looking at retail trends, what's concerning is the goals aren't unreachable, indicating that trends in consumer behavior are changing quickly.
