As department stores struggle, business is booming for The TJX Cos., the discount retailer led by CEO Ernie Herrman.
In its 40-year history, the Framingham, Mass.-based company has delivered steady sales and earnings growth and some of the highest returns on investment in retail, with only one year of annual comparable store sales decline. As TJX continues to build more stores in the U.S. and around the globe, there may be no end in sight.
“Looking ahead, we feel great about our prospects for growth in the near and long-term and building our market share,” CEO Ernie L. Herrman tells investors.
Ranked No. 87 in the 2017 Fortune 500 listings, TJX at the end of its fiscal 2018 third quarter in October had 4,052 stores in nine countries, and three e-commerce sites. In the U.S. the company operates TJ Maxx, Marshalls, HomeGoods, Sierra Trading Post, and Homesense, as well as tjmaxx.com and sierratradingpost.com.
Herrman, 56, was elected CEO in January 2016, serving as president since January 2011, and joined the TJX board of directors in October 2015. In previous roles, Herrman served as senior executive vice president, group president from August 2008 to January 2011, with responsibilities for The Marmaxx Group, HomeGoods and TJX Canada. From 2005 to 2008, he served as president of Marmaxx. Herrman has also held various merchandising positions with TJX since joining in 1989.
Herrman sees opportunities, not threats, according to Fox Business. The disruption in the retail sector – with department stores canceling orders and manufactures making too many items – TJX can scoop up merchandise at bargain prices, the CEO says. Many big brands also make some merchandise for TJX, typically by recycling past seasons’ best-sellers.
“We’re actually having to hold ourselves back to ensure that we don’t buy too much too soon,” Herrman says.
In August, the CEO said that over the long term there was an opportunity to open as many as 5,600 stores, about a 1,500 increase from the current count.
“We see enormous global store growth potential for TJX,” Herrman tells investors. “We have plenty of white space or markets to fill in throughout our current countries. We continue to see store openings as an attractive investment and a very good use of capital internationally.”
He’s No. 90 on Chief Executive and RHR International’s CEO1000 Tracker, a ranking of the top 1,000 public/private companies.
Ernie Herrman, CEO, TJX
Headquarters: Framingham, MA
Undergraduate degree: Boston College
Previous position: Divisional EVP, TJX
First joined company: 1989