J.C. Penney is sweeping out the new
The beleaguered retailer's returning leader isn't wasting any time undoing the changes ousted CEO Ron Johnson made.
By all accounts, ousted J.C. Penney (JCP) chief executive Ron Johnson made a royal mess of the century-old retailer.
His replacement, Myron Ullman, isn't wasting time mopping up after him.
Ullman has already reached out to Macy's (M) chief executive Terry Lundgren in an effort to settle the rival department store chain's potentially ruinous lawsuit over Martha Stewart-branded home goods, according to the New York Post.
On top of that, Penney has also parted ways with three top executives who, like Johnson, had previously worked at Apple (AAPL), CNBC reports. Johnson's management team of former Apple executives had reportedly caused some friction with long-term Penney employees. The new execs called those veterans DOPEs, for "dumb, old Penney employees," Bloomberg reports.
The three departing officials are chief operating officer Mike Kramer, chief talent officer Daniel Walker and chief creative officer Mike Fisher. Kramer resigned, but it's not clear whether Walker and Fisher left on their own accord, the piece adds. Fisher and Walker were among the former Apple executives who opted to fly in to Penney's Texas headquarters rather than to relocate.
As for Ullman's approach to the Macy's debacle, it appears he's trying to cut the company's potentially massive losses. According to the Post, Ullman has offered to scrap Penney's 10-year agreement to produce towels and linens with the domestic diva's name.
That will likely come as a relief to Lundgren, who testified in the court case that he was "literally sick to (his) stomach" over Penney's deal with Stewart.
Lundgren was Ullman's first call upon taking on the job, the Post says, a sign of how potentially damaging the lawsuit could be for Penney. If the judge sides with Macy's, which has a longstanding line of Stewart-branded home goods, Penney could lose up to $100 million on the liquidated merchandise, according to a Citi analyst report cited by CNBC.com.
Even with Ullman's concession, that doesn't necessarily mean Stewart will be absent from Penney stores. Ullman is said to be asking Lundgren for permission to sell at least the Stewart-designed items labeled "JCP Everyday" if it clears items directly bearing her name.
Of course, Penney has a longer-term -- and bigger -- issue at hand. Johnson sought to remake Penney with younger, trendier clothes, but that has gone over about as well as decades-old fashions. A Kim Peterson wrote here Wednesday, Johnson didn't test his vision before putting it in place. Sales last year plunged 25%.
It remains to be seen whether Ullman will return to Penney's more typical clothing mix or bring back its beloved coupons and clearance racks.
But if Ullman is paying attention to consumer research, it's likely that he will. After all, the majority of Penney's customers are older than 55, and one-third earn less than $35,000 a year, as Bloomberg Businessweek notes.
For those customers, Johnson's Pearl Georgina Chapman of Marchesa Peplum Lace Print Top, with a suggested retail price of $50, isn't going to fit the bill.
You can't sacrifice your old customers in the hunt for new ones. If you fail to listen to your market, you will fail.
I like some of the more trendy clothes that Penney's brought in, but it was a mistake to get rid of their standby's like St. John's Bay. The less expensive & less trendy clothes were always their bread & butter, so it seems counter-intuitive to quit carrying the brands and values that made Penney's famous.
WE can hope that Pennys now goes back to the way it was with CUTE CLOTHES THAT ACTUALLY FIT A MIDDLE AGED PERSON.. NOT TO MANY OF US ARE SIZE 0-4. AND EXERCISE CLOTHES THAT FIT COMFORTABLY NOT STRETCH SO TIGHT IT LOOKS LIKE A HORROR SHOW ACROSS A RUMP
good! i've always liked jcp and haven't been pleased with their new way of doing things. hopefully this guy can set it on the right track. ugh, get martha out of there! how is she able to have contracts with multiple companies, anyway?
I don't shop at Penney's anymore. They are wasting energy on all the BRIGHT lighting they have installed. All their clothes are for the younger set (who do not shop at Penney's). Penney's used to be one of the OLD FAVORITES, not any more. I'm wondering IF "they can bring it back"? Hopefully they can.
Clothes that fit the average person would be nice. As well rid of the colage of clothing of the K-Mart area and the so called trendy pricing. This type of store was orig. designed for the average person and not the trendy.
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[BRIEFING.COM] The stock market finished an upbeat week on a mixed note. The S&P 500 added just over a point, holding its weekly gain at 1.0% while the Nasdaq lost 0.4%.
The major averages began the day on an upbeat note, but relinquished their opening gains during the first 90 minutes of action. The early sentiment was boosted by a better-than-expected nonfarm payrolls report for February (175K versus Briefing.com consensus 163K), but a closer look into the report suggested that ... More
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The solid report comes a month after the retailer closed all of its Canadian operations.
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