J.C. Penney plans to invest more than $1 billion by fiscal 2025 toward improving its operations and customer experience.
According to published reports, the chain will put money into digital capabilities, in-store upgrades including technology, and merchandising and supply chain improvements.
The company also plans to increase its appeal through inclusive and affordable merchandising, customer service and local community engagement.
Since emerging from bankruptcy over two years ago, the company continues to struggle. Last year net sales fell 3.4% year over year to $7.6 billion, and net income plummeted 36.3% to $221 million, according to a report on retaildive.com.
J.C. Penney’s most recent plan builds on investments already made since the department store was snapped up out of bankruptcy by two of its landlords, Simon Property Group and Brookfield, in late 2020. Brand management firm Authentic Brands Group also recently took a stake of nearly 17%, retaildive.com reported.
JCPenney’s CEO Marc Rosen, who took over company’s leadership in November 2021 and has served as an executive at Levi Strauss and Walmart, told the Associated Press he is renewing the chain’s focus on its core middle-income shoppers with affordable fashion and housewares.
“Now is the time more than ever to lean into that and make sure that we’re delivering that experience for our customer,” Rosen told the AP.
What wasn’t announced were any plans to shrink stores, reduce the company’s fleet or move away from malls, many of which are owned by Penney’s new owners.
Kohl’s and Macy’s have recently announced plans to run more smaller stores. Kohl’s already operates mostly in strip-style centers, and Macy’s has greatly expanded plans to open more small-format stores away from the mall. J.C. Penney didn’t immediately respond to questions about whether it will explore such options, according to retaildive.com.
But neither a change in venue nor a billion-dollar investment is likely to help the department store much at this point, according to Nick Egelanian, president of retail development firm SiteWorks.
“All the money in the world cannot fix a relevancy problem,” he told retaildive.com in an email. “J.C. Penney is an obsolete retail concept in obsolete real estate with an obsolete business strategy.”
