JC Penney 'Valentine's Day Massacre' coming?

Insiders are reportedly worried about rumors that the retailer's CEO will lay off hundreds at the corporate offices this month.

By Kim Peterson Feb 6, 2013 3:38PM
Customer Service counter at the J.C. Penney store in Westminster, Colorado on February 20, 2009 ( RICK WILKING/Newscom/RTR)J.C. Penney (JCP) insiders are worried about upcoming layoffs this month, calling it a "Valentine's Day Massacre," The New York Post reports.

There are rumors that CEO Ron Johnson may lay off at least 10% of the 3,000 employees working at the company's headquarters in Plano, Texas.

Johnson may have been itching to do this for a while but may have wanted to wait until the company's new fiscal year began, the Post reports. That's because laying people off costs money -- in severance pay, for example -- and Johnson didn't want to load up the previous fiscal year with even more expenses.

Sources tell the newspaper the company is running low on cash. And its third-quarter earnings report confirms it, showing that at the end of October J.C. Penney had $525 million in cash -- down from $1.1 billion a year earlier.

Johnson was asked about the rumors Wednesday on CNBC and didn't give a definitive answer. Here's what he said, according to The Dallas Morning News:
"No, no. There are a lot of rumors. We have a rumor a day, it seems like. Today it's about layoffs at our headquarters. I would never talk about that, but you've got to separate the facts from the rumors. Ultimately, we need to have the right cost structure for the business and we have to grow. And we're going to be sure we do those two things."
Johnson has been busy bringing in outside brands to stores, including Martha Stewart and Joe Fresh. Something has to give when you're making that kind of pricey investment, and the Post reports that the ax will likely fall on the designers and other employees who develop Penney's private-label brands.

Already, the Post reports, private brands like St. John's Bay and Arizona are starting to disappear from stores.

More on moneyNOW

Tags: Retail
Feb 6, 2013 5:12PM
Yes, me too with the St. John's Bay.. I did like their jeans and other stuff...
Feb 6, 2013 5:03PM

I used to LOVE JCP, but recently their products do not have the same quality as before, and big and tall sizes are difficult to find.  I have been really disappointed by Penny's.


Feb 6, 2013 5:03PM
I wandered into our local JCP after Christmas and was amazed at the prices.  They have cleared out the junk and put good prices on what looks like better quality stuff.  The JCP here in town looked about the same for the past 10 years, not anymore.  If you are talking down JCP (like I was this time last year) you haven't been to one lately.
Feb 6, 2013 4:59PM
How about you NOT use the word "massacre" in your article title.......garbage!!
Feb 6, 2013 4:57PM

The St. Johns Bay brand was the reason I shopped at JCP.  FIRE the STUPID ceo and bring back St. Johns Bay brand.

Feb 6, 2013 4:44PM
Feb 6, 2013 4:43PM

There are a lot of reasons to give up on JCP, but gay dad isn't one of them.


Feb 6, 2013 4:41PM
Their style is so-so sometimes and it seems like they are lacking to keep up with the times.  I am not a fan at all of their no coupon thing anymore and this fair pricing game they are playing is a joke.  You can put any suggested price on a ticket and then charge less so it seems like you're getting a good deal.  They take us for fools and thats why people are avoiding them.  I hope Ron Johnson gets the can soon, he's driving JCP into the ground. 
wait.. guess this explains why its getting harder and harder to find my son some pants!
he is a very awkward size, very long legs and the waist of a toddler ( considering he's 7)
Arizona jeans were always our favorites, general wear well, reasonably priced and they FIT him...
now what is a mother suppose to dress her son in?
J.C.P get real you were the store for the moderate family.. Get back to it, we will come back, we need you

After getting rid of Arizona & St. Johns Bay, there is no reason to shop there anymore.  Those were terrific brands, good quality and great prices.  I am done with JCP
Feb 6, 2013 4:28PM
Which chain closes first?  JC penney or Kmart?  Both in trouble.
Feb 6, 2013 4:27PM
Why don't they do the right thing and get rid of that ahole Johnson.  I hate to tell you ignorant shareholders that he has to go.
Feb 6, 2013 4:24PM
Fire Ron J., fire Ellen D. then start to run JCP as a real business again instead of a political correctness program.  Johnson and the idiots who hired him should never be allowed to run a business again.  JCP was my favorite clothing store before all this crap happened.  I am sad to see a good business being killed by out of control management.
Feb 6, 2013 4:14PM
JCP used to be my go-to store. I always did the majority of my school and Christmas shopping there. The store has turned into something I don't even recognize and now they're getting rid of St. Johns Bay and Arizona? I have no idea what these people are thinking. Count me out!
Feb 6, 2013 4:09PM
I gave up on Penney's once I saw the gay dads ads on July 4th....that closed down 35 years of shopping there. Never will shop there again!!
Feb 6, 2013 3:49PM
Take away St. John's Bay brand & I'm done.
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