The Otto Group has decided to strengthen the management of its sporting goods retailing subsidiary, Sport Scheck. It has appointed a new chief executive, Markus Rech. The former CEO, Stefan Herzog, will report to him as a member of the executive board, which also includes Guido Jaenisch. Another member of the executive board, Jürgen Habermann, left in mid-2014.
Described as an expert in multi-channel retailing, the 41-year-old Rech has been running another German sporting goods retailer, Engelhorn Sports, since 2006. He had previously worked for Sport Eybl in Austria. Jaenisch will be handling e-commerce, IT and logistics. Herzog will be in charge of purchasing, marketing and subsidiaries.
The change of management comes after Otto reported that Sport Scheck suffered another sales decline in the past year, reportedly due to the conversion to a new IT and logistic system. Its sales fell by 7.2 percent to €296 million for the financial year ended Feb. 28.
Meanwhile, the third generation of the Otto family is taking charge at Otto Group with the nomination of Benjamin Otto as an “active” member of the executive board, with effect from June 1. The 39-year-old, who is widely expected to take the place of Hans-Otto Schrader as chief executive when he is set to retire next year at the age of 60, says he plans to lead the group “fully into the digital era.” Most recently, he co-founded a subsidiary called Collins, based on an innovative online retailing concept, which achieved sales of more than €10 million in its first year of operation.
At the same time, Benjamin's 72-year-old father, Michael Otto, who runs the supervisory board of the group, has transferred his majority stake in the company to a new foundation, the Michael Otto Stiftung. It was established already in March 2014, with the goal of keeping the company's ownership under the family's control for several generations to come, with its headquarters in Hamburg. According to Forbes, Michael Otto and his family ranked 50th last March on the world list of billionaires and the fifth in Germany with total assets of $17.5 billion.
The Otto Group raised its total revenues by only 0.5 percent to €12.06 billion in the past year, but its 100-plus web stores around the world showed a sales increase of around 5 percent to €6.5 billion, including sales of nearly €4.2 billion in Germany.