When Kathleen Mason joined Tuesday Morning Corp. as its president and CEO in July 2000, the upscale discount retailer had a lot going for it.
Customers were loyal and loved the bargains on high-end brands, and they even formed lines on occasion to get into the stores at the start of a sale day. By all accounts, the stores were a hit.
But the company wasn’t doing as well as it could be. Mason, a veteran of the retail industry who previously served as president of Homegoods, thought Tuesday Morning’s balance sheet was bloated and its technology lagging; she notes that Tuesday Morning didn’t even have voicemail when she came onboard.
The company also had way too much inventory, scattered in warehouses across the country to feed the chain of stores. And its marketing wasn’t nearly as savvy as its customers were. As Mason saw it, having a strong brand and bloated balance sheet was an ideal situation.
“It was not looking good from an operational management perspective,” Mason says. “That’s a great set-up for success because as long as you know who your customer is, you have all of the right components for success. … It was an opportunity to return to some great operating margins and be a very profitable business and be a very low-cost operator so that everything we delivered was value to the customer.”
Tuesday Morning’s formula for success is this: Sell great merchandise at deeply discounted prices and close stores for periods of time, so when they reopen with new merchandise, it’s an event. And the stores are always open on Tuesday mornings, hence the name.
The Dallas-based company, which opened its first store in 1974, operates 732 stores in 46 states.
Mason has made the company profitable, with increased earnings each year. In 2004, it reported net income of $62.6 million on sales of $898 million, compared to net income of $24.6 million on sales of $587 million for 2000.
