On April 25, 1996, the Board of Directors of the May Department Stores Company made the decision to distribute Payless Shoe Source common stock. Effective May 1996, Payless will operate as a publicly owned, independent company. With this new venture, Payless common stock will be listed on the New York Stock Exchange. Beginning May 1996, approximately 39. 9 million shares will be distributed by the Bank of New York at the rate of. 16 share of Common Stock for every one share of May common stock held by May common share owners.
The reason for this distribution is “to permit each of May and the Company to adopt strategies and pursue objectives appropriate to its specific retail segment and to permit the Company to structure incentive and benefit programs to reflect the Company’s performance in order to better attract and motivate its associates.” As a result, Payless will no longer be a subsidiary of or affiliated with May. This decision should not adversely affect employees or everyday operations in customer service. Payless success has been attributed to the performance on its associates and an experienced board of directors. The company’s future as the largest footwear retailer in the United States is optimistic. Since 1956, Payless Shoe Source has grown from a small business into a profitable industry with over $2. 3 billion in sales in 1995.
The Essay on 401 K Plans Company Stock Employees
401 (k) Plans There are many economic issues facing the nation today. While some are extremely important in determining how the economy is balanced, others are not. Although this is true, that does not necessarily make these lesser important issues obsolete. Take, for example, the recent issue of corporate leaders matching contributors to the 401 (k) plan with company stock, instead of with cash. ...
Customers represent a large segment of America whose incomes represent 85% of the U. S. population. There are currently 4, 549 stores in the U. S. , Puerto Rico and the Virgin Islands with opportunities for profitable expansion.
In addition, cost control programs and technological advancement techniques implemented in 1995, will be beneficial in reducing excess operating costs. It is anticipated that 240 new stores will be opened in 1996 with 500 more planned in the next five years, many of which will include adjacent Payless Kids’ expansions. Changes between May Company and Payless Shoe Source have taken place. At this time, they may not directly affect employees. This paper serves as an information letter to inform them of changes so that they may have a better understanding of our operating strategy. The May Company has provided certain services in the past and will continue to do so for a limited time.
A summary of those agreements include subleasing of facilities, tax sharing, administrative services and stock options. Payless will begin to assume responsibility for charter and bylaws amendments, voting procedures and the approval process of certain transactions. The rights of share owners of Common Stock will be governed by the corporate laws of the State of Missouri rather than the State of New York. This will result in differences concerning share owner actions without a meeting, issuance to officers, director and employee of rights, options to purchase shares, loans, limitations on liability, shareholder list inspections and certain anti-take-over statutes. In light of this organizational conversion, there are no plans to change basic company objectives. What has worked up to this point, should continue to do so.
Management intends to ensure prosperity by building on current strengths while accelerating new strategies, to increase sales, productivity and profits. Improving business relationships with vendors and factories, responding to the latest fashion trends, anticipating customer expectations and identifying ideal locations for future stores are just some of the ways to capitalize on a broad based market. Marketing efforts on television, radio and other media 2 can continue to promote product affordability and availability. Payless Shoe Source remains committed to aggressive company Quality Assurance policies and standards. Payless will continue to target national discount mass-merchandisers in the value priced segment. In other words, women aged 18-64 make up 40% of our customers, therefore, the company must continue to make every effort to enhance customer relations.
The Term Paper on Does Company T Have A Shared Culture Justify Your
Does company T have a shared culture? Justify your answer with evidence from the case. Let us start from defining a shared culture. Culture, according to Websters college dictionary is a style of social expression peculiar to a class or society. Shared refers to taking part in, using or having in common. We can conclude, therefore, that a shared culture is a commonly used style of social ...
As in any business, changes in the economy cannot assure success. An existing risk could be the fact that Payless is no longer able to rely on May for financial support. Given historical financial information, estimates of future retail sales as an independent company can be seen as positive. Additionally, the threat of competition based on selection, quality and price may also present itself. However, Payless has operated in these segments of retail for many years and has continued to capture increased market share by offering a wider selection of fashionable styles and compelling prices in conveniently located stores. Finally, as with most businesses in the United States, the manufacture of merchandise goods by foreign countries can be affected by political instability, transportation, tax laws and currency exchange rates.
While the Company has not historically experienced material adverse effects from these risks, there is no assurance that these risks will not result in increased costs and delays or disruption in product deliveries in the future. However, Payless can be confident that current social and economic forecasts, along with innovated fashion prediction methods and trends, will provide a secure basis for continued success. 3 THE PAYLESS SPIN-OFF EVA R. KOLLER MAY 2, 1997 CENTRAL MICHIGAN UNIVERSITY IPC 560.
