Following a nationwide search, New York-based executive recruiter Herbert Mines Associates recently placed Jack L. Sinclair as the new chief executive officer of Sprouts Farmers Market which is based in Phoenix, AZ. Amin Maredia stepped down last December to pursue other interests. President and COO Jim Nielsen and CFO Brad Lukow had been serving as interim co-CEOs while the search took place.
“We are extremely excited to have Jack Sinclair as our new chief executive officer following a thorough search and selection process by the board of directors,” said Joseph Fortunato, chairman of the board of Sprouts Farmers Market. “Jack is a proven chief executive officer with an outstanding track record in grocery and retail merchandising. On behalf of the board, we look forward to working with Jack as he leads Sprouts forward to continued success,” he said.
Mr. Sinclair brings to Sprouts over 35 years of experience in retail and grocery. He has been CEO of 99 Cents Only Stores LLC, a discount retailer with over 350 locations in the U.S., since 2018 and prior to that was its chief merchandising officer from 2015 to 2018. From 2007 to 2015, Mr. Sinclair was the executive vice president of the U.S. grocery division of Walmart, where he led all aspects of its U.S. grocery business across some 4,000 stores, which generated substantial growth under his leadership through a focus on local assortment and fresh foods.
In addition, Mr. Sinclair previously spent 14 years at Safeway PLC in London where he was responsible for operations, merchandising and marketing for over 450 Safeway supermarket and convenience store locations throughout the U.K. In addition, Mr. Sinclair has served on the board of directors of The Hain Celestial Group, a marketer, manufacturer and seller of organic and natural products, since 2017.
Well-Matched Skill Set
According to Jefferies analyst Christopher Mandeville, Mr. Sinclair brings a skill set that’s well-matched to those of Sprouts’ remaining C-suite. “His lengthy experience within discount and grocery should bring significant knowledge to the table, especially in small-format/fresh, as 99 Cents is as produce-focused as you’ll get in the dollar channel (and comp growth was quite impressive during his time there), while Walmart’s Neighborhood Market format realized considerable unit growth during his final years in charge of all U.S. grocery.”
“Paired with his exposure to natural and organic CPG at Hain, [Mr.] Sinclair’s background could prove highly complementary to president and COO Jim Nielsen, an individual we’d coin as the key man to operations, assuming he returns to the company as planned post-medical leave,” Mr. Mandeville noted in a recent research note.
“I am humbled and extremely privileged to be appointed chief executive officer of Sprouts Farmers Market,” said Mr. Sinclair. “Sprouts is a company with a higher purpose – to empower every person to eat healthier and live a better life – and the commitment of its 30,000 team members to drive lasting change in the communities they serve truly resonates with me. I look forward to working with Sprouts’ board of directors, leadership team and all Sprouts team members to continue furthering that purpose,” he said.
The leadership change comes as Sprouts pursues an aggressive growth strategy. In 2018, the grocer opened 30 stores, and this year it aims to open another 28. The company currently operates more than 320 stores in 19 states, and it expects to have 340 stores in 22 states by the end of this year. Sprouts has annual revenues of more than $3.59 billion.
Challenging Retail Sector
Established in 1978, Herbert Mines is a specialist search firm focusing on the retail, fashion & apparel, beauty, consumer products & services, hospitality, leisure, and restaurant, and digital/technology industries. The firm is noted for its C-suite recruiting work.
Retailers are facing major shifts in their businesses that call for “unprecedented responses” by CEOs who can effectively lead through change, intuitively and analytically understand the evolving consumer and respond to ambiguity, according to the search consultants. Developed markets, excess retail capacity, rising prices, the shift to omnichannel retail and the unpredictable pace of change in consumer shopping habits all affect the type of leader that retailers need.
In addition, retail CEO turnover is accelerating. Herbert Mines reported that 47 percent of public retail companies with revenues exceeding $1 billion experienced a chief executive change the past five years (up from 34 percent during the previous three years). Since 2007, 71 percent of retail companies have experienced a switch in CEO.
“Retail is not dying but it is changing form,” Herbert Mines Associates chairman and CEO Hal Reiter noted in a recent report on the retail sector. “We are excited to see that many online retailers continue to open physical locations, expanding from a pure play model to an omnichannel play.”
Many digitally native companies recognize that brick and mortar locations are where customers can immerse in brand culture, and the in-store atmosphere has proven to be a key differentiator for brands to create lasting impressions and returning customers, he said. “With traditional brands and digital-first retailers converging, the true omnichannel strategy will win. Despite the transformation retail and consumer has seen since 1978, we are proud of our ongoing commitment to quality and our role as partners and thought leaders within the space,” he said.
“We have witnessed an unprecedented amount of change within the consumer and retail industry and the speed of change is accelerating,” said Brenda Malloy, president of Herbert Mines Associates. “Our clients are facing a hyper-competitive convergence of channels, coupled with an information/content overload. With that, CEOs are forced to continually anticipate the “what’s next” to ensure the customer is remaining at the core of decision making and they are continuing to re-evaluate their value proposition & organizational structure to ensure C-suite alignment,” she added.
Convergence is a Complicated Proposition
“At Herbert Mines Associates, demand has been high as we deliver innovative C-suite talent solutions and serve as strategic thought partners to our clients,” she said. “Over the past year, [we] have been a strategic partner to clients in the retail, consumer products and hospitality sectors.”
“Today, leaders who possess strategic agility, raw intellect, business acumen, enterprise level leadership, and digital acumen are in most high demand,” said Ms. Malloy. “Furthermore, in today’s state of disruption, an ability to collaborate, to be flexible/nimble/agile and to have strong communication skills is of the utmost importance. Today’s environment requires those with conviction, vision and clarity to navigate through unchartered waters,” she said. “More specifically, we have seen an increase in the needs of strategic chief people officers, chief strategy officers and the newly created role of chief customer/experience officers.”
When asked about some of the biggest challenges facing the retail sector, Ms. Malloy said with a “hyper-aggressive and competitive environment, digital disintermediation, an abundance of information and the speed of change,” retail companies are struggling to keep up with, let alone get ahead of, the constant disruption.
“Retailers are re-thinking their leadership, understanding that with the convergence of channels (in-store, e-commerce, mobile) comes a convergence of roles and responsibilities,” she said. “As roles converge, hiring talent and/or creating new roles has become a complicated proposition.”