Tok&Stok tries to get back on track under founder’s command

Ghislaine Dubrule, who founded furniture and decoration retailer Tok&Stok 45 years ago alongside her husband Régis, has been back in charge of the company for six months "to get things back on track." After closing stores, reducing the workforce, and simplifying the management structure, the businesswoman projects that it will make just over R$1 billion this year and "if it makes a loss, it will be very small."At the company’s headquarters, housed in an old Votorantim factory in Vila Leopoldina, in the city of São Paulo, Ms. Dubrule welcomes Valor in a large meeting room. On one of the walls, a colorful calendar shows this year’s promotional campaigns, one per month."The last few years have been very difficult. We’ve had five CEOs, a lot of expenses," said Ms. Dubrule, referring to the chief executives who have run the company over the last six years. The investment fund manager Carlyle, which bought control of Tok&Stok in 2012 for R$700 million, "gave these CEOs carte blanche." And the company became very "unstable."Just over two months ago, in September, the company and competitor Mobly announced their intention to combine their businesses. The due diligence process for a possible merger is expected to be complete by the beginning of 2024.Does this merger make sense at the current stage of Tok&Stok? Ms. Dubrule looks up and replies: "What a difficult question!" The businesswoman, who doesn’t refuse to answer any questions, takes a breath and says that getting a merger off the ground is very difficult in any sector. This possibility, if it goes ahead, will be put to the board.Ms. Dubrule and her husband founded the retailer in 1978 and ran it together until 2012, she on the operations side and he as CEO. In 2012, when Carlyle took over 60% of the company, Ms. Dubrule took over as CEO until 2017. Since then, there have been five CEOs, almost one every year.The controlling shareholder’s plan was to prepare the company to go public on stock exchange B3. Sales, before the pandemic hit Brazil in 2020, were around R$1.5 billion a year. "The idea was to double that to R$3 billion in one to two years for the IPO. As soon as possible," said Ms. Dubrule. To keep up with the ambitious target, the company invested in a much larger structure.The 40,000-square-meter distribution center located in Itapevi, in the state of São Paulo, was transferred in 2020 to a 65,000-square-meter area in Extrema, in Minas Gerais. The technology system, especially the...

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