The Godfreys Group Ltd (ASX: GFY) share price has been crushed today, falling almost 31% to $1.10 shortly after the market opened. That compares to a 0.3% rise for the ALL ORDINARIES (Index: ^AXAO) (ASX: XAO) benchmark.

So What: Godfreys, which floated its shares on the ASX just over 12 months ago at $2.75 per share, is a retailer of vacuum cleaners and other floor-cleaning products. In an update to the market this morning, the company not only downgraded its earnings guidance for the 2016 financial year (FY16), but also announced the replacement of its current CEO, Tom Krulis.

Firstly, sales for the first half of FY16 are expected to be marginally lower than in the prior corresponding period (pcp), but comparable store sales have fallen 5.2%. Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) for the period are expected to be up to $8.8 million, down from $11.3 million in the pcp, while net profit for the first half is expected to be roughly 31% lower as well.

Net profit for the full-year is expected to be between $8.5 million and $9.2 million, compared to $12 million in FY15, while sales are expected to be between $181 million and $185 million.

Commenting on the results, Godfreys’ chairman Rod Walker said: “Clearly this is a disappointing financial result which reflects execution challenges at an operational level, in particular a failure to adequately capitalise on the significant market shift away from barrel vacuum cleaners to stickvacs.”

The current CEO, Tom Krulis, will pay the price for the poor financial results and has been given until 27 January 2016 in his current role. Kathy Cocovski, who has more than 30 years’ experience in retail, will take the role as CEO as of that date with the company expressing its confidence that it can perform well in the future under this new leadership structure.

Now What: Godfreys has left shareholders with plenty to consider. Firstly, while it has blamed the poor results on its inability to “shift away” from barrel vacuum cleaners towards stickvacs, there’s also the possibility that tougher competition has played a role in the results.

Harvey Norman Holdings Limited (ASX: HVN) is one competitor, while JB Hi-Fi Limited (ASX: JBH) is now selling vacuum cleaners as well.

Investors should also consider Godfreys’ susceptibility to a potential downturn in the economy, or the possibility that consumer confidence takes a hit. If times get tough, consumers could tighten their wallets and that could impact sales even further.

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Motley Fool contributor Ryan Newman has no position in any stocks mentioned. Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. You can follow Ryan on Twitter @ASXvalueinvest.

The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.