More bad news for JC Penney
There was nothing merry about the holidays for the retailer. Forecasters say sales may have dropped by as much as 30% despite tweaks to stores.
On Friday, UBS analyst Michael Binett downsized his forecast for Penney's fourth quarter and told Reuters he expects same-store sales to decline 28% after originally projecting a 20% drop. The New York Post piled on, saying that sources close to JCPenney told the paper that same-store sales were down more than 30% throughout the holiday season.
That's sent J.C. Penney shares plummeting nearly 8% in the last five days and continued the company's nearly 58% slide since February 2012. That was just after the company announced across-the-board price cuts and its intent to divide its nearly 700 large stores into a series of mini shops for brands like Martha Stewart, Izod, Liz Claiborne and others.
Unfortunately for J.C. Penney and chief executive Ron Johnson, a former Apple (AAPL) and Target (TGT) exec, consumers don't seem to think much of the company's strategy. Same-store sales were down 26% in the third quarter and Johnson abandoned his own limited-discounting policy for Black Friday deals and a recent spate of 20% to 50% price cuts aimed at reducing inventory.
Even Johnson realizes that changing customer tastes will require J.C. Penney to sell more products by designers like Betsey Johnson, Nanette Lepore and Marchesa, but racks full of everyone's great aunt's favorite brass-buttoned outfits have to be cleared first. That leaves the store stuck in a retail limbo where it's trying to transition from one customer base to another, but doing little to please either in the interim.
This puts J.C. Penney dangerously close to Sears (SHLD) territory. That foundering retail chain and its Kmart holding have resorted to selling off real estate within their large stores to gyms and grocery stores just to make a few extra bucks. Successive reports of falling sales and revenue at Sears and continued selloffs of both stores and intellectual property like Craftsman tools make Sears look like a company in liquidation. Even its remaining stores haven't been spruced up in a number of years.
The difference at J.C. Penney is that it at least appears that Johnson and company are trying to save the retailer. The chain is pressing on with its mini-stores idea even as it abandons its anti-discounting stance and Johnson and others continue to invest cash and energy into the brand. With sales dropping by more than a quarter with each earnings report, however, all that effort may amount to going down swinging instead of going down looking.
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I hate to see old ships sink,they use to have a really good product St Johns Bay and coats ,etc,their underware were the best ,ts all pocket tees for men,and women and I found some really good deals in shoes etc. I love their Levis department ,set-up very spacious and easy to read, there is just too much out there and .com r killing alot of life ,jobs ,just tto much crap today!!!!!!!!!!!!!!!!!!!!!!!!!!!
god bless us ,jc ,and the fallen world
I was in our local JC Penneys over the weekend. The store looked bare. The brands that I was used to buying are no longer lines they are carrying. The quality of the clothes looks no better than Walmart brands. I don't see how JCP will make it through the new year. The displays or should I say lack of displaying does not invite anyone to purchase anything in the store. RIP!!! Let Kohls rule!!!!
no! but Obama and demos and bias media said the economy is growing! AND THEN HE RAISES MIDDLE CLASS TAX CUTS AND GIVES
RAISES TO CONGRESS AND EXTENDS UNEMPLOYMENT AND WELFARE FOODSTAMP BENEFITS AND GIVES ALL HIS BUDDIES
LIKE GE HOLLYWEIRD GREEN ENERGY BIG UNIONS ETC..ALL TAX BREAKS AND STIMULUS MONEY AND THEN GOES ON HIS
FING VACATION! ALL THE WHILE FUEL ENERGY AND FOOD PRICES ARE SOARING HE DOES NOTHING! OBAMA SUCKS!
I really think that the changes made are not working out, now is a pain in the neck finding something in the store specially here in Plaza Las Americas in Pto Rico, where the store is so big that it now looks as if iit s closing, lots of empty spaces, not enough salespersons and very boring to shop on it
I don't need or want JC Penney to be another Khols or Belks, it had a flavor all it's own. It offered well made, stylish, often trendy and competively priced merchandise, in styles and sizes that offered something for everyone. Most holidays, I did all my shopping at Penneys. As another poster said, they have the best selection of bedding, linens and towels of anyone. One mistake they made a few years ago was creating centralized cash registers. Instead of dept. registers. If you were shopping in bedding you had to carry an armload of items halfway through the store to find a register. ( it's not like they supply shopping carts). I am certainly less inclinded to purchase if I have to hunt down someone to hand over my money to.
As with ANY retail establishment. QUALITY merchandise and HELPFUL, curteous sales associates go a long way to keeping customers. Spend a little more time and money on training your staff and less on gimmicky advertising and see where that leads you.
Maybe if JCP would update their website and actually have the merchandise in stock that they display people might shop there but it isn't uncommon to find 5-6 items that are on the website only in one or two sizes or completely unavailable.
Their quality isn't great either.
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