J.C. Penney hires former Shopko executive to aid turnaround

Predicting the demise of Sears & Kmart since 2017!
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Re: J.C. Penney hires former Shopko executive to aid turnaround

Post by storewanderer »

arizonaguy wrote: December 19th, 2019, 12:01 pm

Part of the issue with physical stores this year is that there were virtually no incentives to actually go to the physical store. Most retailers had their doorbusters available online. I bought an iPad from Target that way (the best deal was online without having to go to the store at all).

As far as JCPenney and Macy's are concerned, I don't find either of them to be a relevant retailer. I still find Kohl's to have the styles I want at decent quality levels and decent pricing. JCPenney has mostly overpriced junk. Macy's has decent items but it's simply not as convenient for me as elsewhere.
I think Kohl's locating off mall in more neighborhood type locations will help them have relevance longer term.

I went to two malls today and frankly the experience is not good. I understand it is the weekend before Christmas, but it is not good.

Arden Fair in Sacramento has a lousy parking lot with spaces too small, poorly placed doors/crosswalks, and does not feel overly safe. Due to some people loitering/lurking in the lot I made sure nothing of any value was visible in the back seat of the car before I went inside. I was panhandled in the parking lot while walking into the mall. By the time I went from my car to the sidewalk to enter, I was already ready to leave and I hadn't even set foot inside yet. Also exiting the place was a real hassle again due to a poorly designed lot. Nordstrom is in the mall and frankly I am pretty surprised at this point. This was the premier mall in Sacramento before Roseville Mall opened in the 00's though.

The other mall was a smaller mall with a lot of vacancies and it was not overly crowded, but again, just seems like it would be easier to go shop at the Kohl's a couple miles away.
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Re: J.C. Penney hires former Shopko executive to aid turnaround

Post by Super S »

storewanderer wrote: December 20th, 2019, 10:59 pm
I think Kohl's locating off mall in more neighborhood type locations will help them have relevance longer term.

I went to two malls today and frankly the experience is not good. I understand it is the weekend before Christmas, but it is not good.

Arden Fair in Sacramento has a lousy parking lot with spaces too small, poorly placed doors/crosswalks, and does not feel overly safe. Due to some people loitering/lurking in the lot I made sure nothing of any value was visible in the back seat of the car before I went inside. I was panhandled in the parking lot while walking into the mall. By the time I went from my car to the sidewalk to enter, I was already ready to leave and I hadn't even set foot inside yet. Also exiting the place was a real hassle again due to a poorly designed lot. Nordstrom is in the mall and frankly I am pretty surprised at this point. This was the premier mall in Sacramento before Roseville Mall opened in the 00's though.

The other mall was a smaller mall with a lot of vacancies and it was not overly crowded, but again, just seems like it would be easier to go shop at the Kohl's a couple miles away.
JCPenney has at least noticed what Kohl's has been doing and has opened some off-mall locations in recent years, which feature centralized checkouts among other similarities. But it seems like too little, too late. The off-mall stores are nicer, but the product is the same, and the stores don't seem any busier.

Kohl's has opened some stores in malls which seem to do ok though....
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Re: J.C. Penney hires former Shopko executive to aid turnaround

Post by Bagels »

Super S wrote: December 21st, 2019, 7:19 am
storewanderer wrote: December 20th, 2019, 10:59 pm
I think Kohl's locating off mall in more neighborhood type locations will help them have relevance longer term.

I went to two malls today and frankly the experience is not good. I understand it is the weekend before Christmas, but it is not good.

Arden Fair in Sacramento has a lousy parking lot with spaces too small, poorly placed doors/crosswalks, and does not feel overly safe. Due to some people loitering/lurking in the lot I made sure nothing of any value was visible in the back seat of the car before I went inside. I was panhandled in the parking lot while walking into the mall. By the time I went from my car to the sidewalk to enter, I was already ready to leave and I hadn't even set foot inside yet. Also exiting the place was a real hassle again due to a poorly designed lot. Nordstrom is in the mall and frankly I am pretty surprised at this point. This was the premier mall in Sacramento before Roseville Mall opened in the 00's though.

The other mall was a smaller mall with a lot of vacancies and it was not overly crowded, but again, just seems like it would be easier to go shop at the Kohl's a couple miles away.
JCPenney has at least noticed what Kohl's has been doing and has opened some off-mall locations in recent years, which feature centralized checkouts among other similarities. But it seems like too little, too late. The off-mall stores are nicer, but the product is the same, and the stores don't seem any busier.

Kohl's has opened some stores in malls which seem to do ok though....
In the early 2000s, JCP’s strategy was to move toward off-mall sites in middle-class strip malls. They moved away from this in the mid-2000s, when numerous anchor stores became available (mainly as a result of Macy’s acquisition of Robinson-May). I don’t think they’ve built standalone stores since, and if they have it isn’t many. Doubling-down in malls seemed like the right move at the time, but it likely hurt them in the long-haul.
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Re: J.C. Penney hires former Shopko executive to aid turnaround

Post by Bagels »

storewanderer wrote: December 18th, 2019, 10:10 pm Both JCP and Macy's appear to be having a pretty miserable holiday season here in Nevada. I think in general the retailers are not doing well this year. The Wal Mart near me, the Christmas seasonal set looks about like it did a month ago... I cannot believe how much they have... as in, not much stuff is moving and I will look forward to the 75% off and 90% off sales in a few weeks.

Macy's looks pretty good, it is well stocked and has a lot of appealing promotions on clothing. The store seems more orderly and organized than it has the past couple of years (maybe because business is down so much). Traffic in men's clothing seems very low, but in women's it seems higher traffic, but there is a noticeable concentration of customers in the cosmetics and shoes areas and the clothing areas are not very busy. Staffing seems very low (like, they didn't even add any extra staff for the holidays, or maybe could not recruit due to the labor shortage). Conversely, the Macy's home department looks like it has sort of given up, from a traffic perspective and staffing perspective. They have cut out a lot of merchandise and what they do have is on lower shelves/racks and just does not come off as anything above the quality of Wal Mart or Target, but at much higher prices. Their bedding category has what is obviously above average product, but again, nobody seems to be buying. There is like one employee on the entire floor every time I have been there this past 3 weeks, and hardly any customers. I don't know what happened as home used to be a strong category for Macy's in this particular location.

But Macy's has a good online presence and strong buy online pick up in store offering with the RFID tracking used on many items so the store can pick these orders very efficiently. So even if Macy's physical stores are not doing well, they have a lot of online options.

The JCP Store on the other hand is a joke. The racks are a mess. About 25% of the sales floor space in women's is clearance and product is not moving and overflowing off the shelves. The men's area (which is larger than the women's area) has a lot of clearance also, but it does not dominate the department in the same way. That area also seems much more orderly and more attractively merchandised (maybe since the manager's office is up next to it). They have marked prices up so high on everything they sell, 70% off is still too high of a price. What was also funny the one night I was there, in the second floor they had 3 employees and only a couple customers up there. But then down on the first floor which is women's/kid's/jewelry/Sephora/shoes at the register near the mall entrance they had one clerk and 5 people waiting in line and that line moved so slow that when I walked out of the store 15-20 minutes later, 2 of the people who were waiting when I walked in, were still there. I haven't bought anything from JCP in years so I don't know what their process is but their point of sale must be painfully slow.

JCP's online presence is particularly poor and a few items I looked up online were priced higher online than in the store (already too high in the store).

Not sure what will come of JCP. The local Sears converted into a noisy/musty/stinky arcade/bowling alley with absolutely awful video game pricing. I think I miss Sears, compared to what replaced it.

Most people I talk to are doing their shopping online, some who say they have never done "all of it" online before like they are this year. I am hearing some negative comments about shipping speed, but in general people seem to not mind waiting a while for shipping, if they don't have to go to the physical store.

I haven't been to Dillard's yet but it doesn't matter much what is going on over at Dillard's; they make their money on January 1 with their well published extra percent off all clearance items sale.

I think these malls and physical stores are, in a word, screwed.
It’s interesting to hear that your local Macy’s wasn’t busy. Here in SoCal, their business appeared to be booming - even the Santa Ana location, which carries mostly lower-end merchandise (and very little designer), had lines out the door.

Meanwhile, JCP had already marked most of its winter products, including Holiday items a week before Christmas, to 70% off clearance. It was painfully obvious they’re hurting.

It’s ironic because most of JCP’s private label merchandise is sourced from the same manufacturers as Macy’s... but with a lower price point and better return policy. Nobody wants a $5 SJB shirt, but they’ll happily pay $10 for the same thing marketed as Club Room. Life is all about perception....
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Re: J.C. Penney hires former Shopko executive to aid turnaround

Post by Bagels »

JCPenney had a miserable Holiday season - comps were down 7.5%. Several analysts are projecting that it ended it year with more liabilities than assets, and less than $100M cash on hand. Ouch. Bankruptcy is inevitable, and you have to wonder if creditors won't push for liquidation. With comps continuing to free fall, it's hard to see the chain turning around anytime soon -- especially with the lion's share of its locations in vulnerable malls.
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Re: J.C. Penney hires former Shopko executive to aid turnaround

Post by Bagels »

I stopped by a JCPenny this evening. It's only mid-January, and apparently the chain has already marked down most winter clothing to 70% off. Given the bargain prices, and the recent cold weather here in SoCal (some days this month, it's been as cold and colder than in the Midwest/Northeast!!), there was very little selection left. Which is a good thing... but also a bad thing (the merchandise was sold at a probable loss, especially when prices are stacked with coupons). Typically, JCP does not do mark downs this high until late February/early March (with "final" markdowns coming later in March). Meanwhile, the clearance racks are busting at the seems, mostly with last spring/summer inventory... Two weeks before Chistmas, JCP had most all of its Holiday merchandise marked 70% off. A sign of desperate times...

Walking through this particular store's Home section, there was plenty of cheap, inventory for Black Friday sales merchandise remaining. Tons of stockpots and cookie sheet sets that sold for as low as $2.50 after rebate (AR), and tons of knife blocks & Pyrex sets that sold for (as low as) less than $10 AR. In the past, this stuff sold out within minutes of the store opening. In the same mall, Macy's sold out of its "inventory for Black Friday" small appliances... on Black Friday weekend. But JCP? Still tons left... lots of cheap toasters, toaster ovens, griddles, electric skillet, etc. remaining, even after they desperately marked them down to less than $5 AR at one point.

Sad.
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Re: J.C. Penney hires former Shopko executive to aid turnaround

Post by arizonaguy »

JCPenney is closing 6 stores:

Missoula, Montana: Southgate Mall
Valley Stream, New York: Green Acres Mall
Raleigh, North Carolina: North Hills Shopping Center
Akron, Ohio: Chapel Hill Mall
Tulsa, Oklahoma: Tulsa Promenade
Myrtle Beach, South Carolina: Myrtle Beach Mall

Source: https://www.usatoday.com/story/money/20 ... 505536002/
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Re: J.C. Penney hires former Shopko executive to aid turnaround

Post by storewanderer »

They need to close a lot more than 6 stores.

They are in real denial about their position. At the rate they are going and their finances, Sears may be in business longer than they will be.

This is going to come to a quick dramatic end unless something changes real fast (either their sales trends and profitability improve, or they do what is needed and close a significant number of stores, perhaps exiting certain regions entirely).

The condition of the Reno JCP is like a flea market. Years old clearance items in a large fraction of women's clothing. Men's area is in better condition. Very understaffed, dirty, messy store with a very poor layout. Also noticed last week when I went in, the men's restroom in this store is a one person use (lock the door as you go in) restroom. What kind of a major department store in a mall with a big 2 floor 125k sq ft. store has a gas station level bathroom that is one person use? Only JCP.
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Re: J.C. Penney hires former Shopko executive to aid turnaround

Post by BillyGr »

storewanderer wrote: January 17th, 2020, 6:41 pm Also noticed last week when I went in, the men's restroom in this store is a one person use (lock the door as you go in) restroom. What kind of a major department store in a mall with a big 2 floor 125k sq ft. store has a gas station level bathroom that is one person use? Only JCP.
Older store, I suspect?

I think many of these (one that comes to mind here is a former supermarket that is now a Tractor Supply) probably had two toilets (or perhaps a toilet and a urinal for the men's room) at one time, but were built smaller and thus couldn't provide handicapped access in that configuration.
Rather than spending money to enlarge them, it was probably easier (and cheaper) to remove the second toilet/urinal and make it a one person use restroom.
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Re: J.C. Penney hires former Shopko executive to aid turnaround

Post by Bagels »

When they renovated the tri-level JCP in Santa Ana (former May/Robinsons-May Men's Store), the men's bathroom shrunk to a urinals and two stalls. One of the stalls has been "out of order" each time I've been in the place, dating back to the summer. Then again... at a nearby Kohl's, the handicap/family restroom has had an "out of order" sign for a very long time, but I've noticed employees using it (it's locked with a key), so maybe JCP is playing the same dirty trick.

xxx

My bet is JCP will file Ch11 this year, and announce mass closings. Heck, the whole chain could liquidate -- with their poor performance, they'll have a hard time finding anybody willing to invest or lend them money. The clearance racks are bursting at the seems from spring/summer/fall falling, and last year at this time, they had very little on those racks -- it's obvious they had a bad year. Meanwhile, the nearby Kohl's have practically no leftover inventory on their clearance shelves.
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