The Bon-Ton Stores Soars After Turnaround Strategy Announced

Shares of small-cap stock The Bon-Ton Stores

are soaring on Wednesday after the company's CEO outlined a turnaround strategy for the struggling department store operator. Heading into the last hour of trade, BONT had risen around 30 percent to $12.50. Brendan Hoffman, formerly of Lord & Taylor, said that his company will try to improve financial performance by cutting costs, controlling inventory levels and improving its marketing efforts. The company operates 272 department stores in the U.S., with a focus on apparel, accessories, cosmetics and home furnishings. The CEO's comments came at a retail industry conference. Hoffman said, "We tried to get too young too quickly ... not younger by years, but younger by decades." He added that the strategy of shifting the company's focus towards younger customers drove away loyal consumers and did not drum up enough new business. The company's new strategy is to diversify its offerings to appeal to a broad array of shoppers. Hoffman added that Bon-Ton would begin to make more use of coupons to bring in consumers. "We are going to use coupons. I've learned at Lord & Taylor that customers respond to them. I see Bon-Ton moving in a similar direction," he said. After Wednesday's huge rally, BONT shares have surged more than 273 percent in 2012. Over the last five years, however, the stock has plunged more than 57 percent.