Blog: JC Penney's future takes it back to the past
Leonie Barrie | 21 August 2013
Without naming names, it's clear Ron Johnson's presence continues to loom large at JC Penney.
Time and again on a call with analysts yesterday (20 August) current CEO Mike Ullman referred to "the mistakes of the past" as he tried to explain the department store retailer's dire second quarter performance.
"It's no secret that the company's prior merchandising and promotional strategies weren't working." "There are no quick fixes to correct the errors of the past." "Our top priority...has been...reconnecting with our customer who frankly had lost faith in us."
During his two-year tenure, which ended in April, former Apple executive Johnson hoped to breathe new life into the retailer by focusing on everyday low prices instead of promotions, in-store boutiques, and replacing private labels with new brands.
Customers deserted the store in droves, and since Ullman's return to the helm four months ago he has focused on reversing Johnson's changes step by step - by bringing back promotions, realigning inventories, balancing private brands (like Arizona, and Total Girl) with national ones (Nike, Levi's and Vans), and reinstating popular labels like St John's Bay.
To the cynic, it looks as though the retailer is heading in full-circle, with a strategy that is simply taking it back to where it was two years ago, albeit with even wider losses (US$588m in the second quarter) and slumping sales.
Optimistically, Ullman says despite double-digit declines, second-quarter comps saw a 470 basis point improvement from the last quarter, and sales have improved sequentially month-by-month.
But even he admits: "There are no quick fixes to correct the errors of the past." And even fewer, it would seem, to build the retailer of the future.
Ethiopia may have more trump cards to play than any other sub-Sahara African country when it comes to developing a competitive cotton, textile and garment supply chain, but it still has a rough road a...
Once a bellwether of US retailers' likely performance over the upcoming holiday, sales during the just-gone Black Friday/Thanksgiving weekend have dropped for the second year in a row....
Instead of relocating production in an attempt to sidestep the challenge of rising labour costs, China's textile and clothing manufacturers should work to create a more sustainable industry....
The US Environmental Protection Agency (EPA) has added nine benzidine-based dyes used in clothing to a new ruling to prevent them from entering the US market....
An online tool to help apparel brands, retailers and manufacturers work towards improved wages for garment workers in global supply chains has been updated in a move that marks another step towards th...
- 2014: Year in review - Sourcing winners and losers
- COMMENT: The decline of the buying office
- 2014: Year in review - Brand winners and losers
- 2014: Year in review - Retail winners and losers
- Vietnam factories face fire safety challenge
- Report urges overhaul of Cambodia factory safety
- Triumph recalls 22,000 bras for underwire fault
- Wage theft of migrants in Thai apparel industry
- Investigation uncovers China's dog leather trade
- Vietnam “promise” for Italy textile machinery