retail news in context, analysis with attitude

The Motley Fool has a story about how JC Penney, which needed to have a strong holiday season if it is to have much of a chance to survive, didn't - same-store sales for the last nine weeks of 2019 were down 7.5 percent, the company has projected that the past year's same-store sales will be down between seven and eight percent, and it "closed the third quarter with $8.69 billion in assets and $8.69 billion in liabilities."

This, the story suggests, "puts the company in a very tough position, as it lacks the cash needed to make a major transformation … CEO Jill Soltau understands how dire the situation is – and she has some good ideas about how to change things – but she lacks the cash to make meaningful changes."

The story quotes Soltau as saying that "we are beginning to see results – both in our numbers and how we operate as a business – from the early implementation of our Plan for Renewal, which is focused on driving traffic, offering compelling merchandise, providing an engaging experience, fueling growth, and building a results-minded culture … Going forward, I am confident that delivering our strategy, coupled with our ongoing discipline and commitment to improving the foundational elements of our business, will return J.C. Penney to its rightful place in the retail industry."

But Motley Fool isn't impressed: "That sounds nice, but it's not reflective of what's actually happening with the company. You can't win in retail without customers, and J.C. Penney has chased away too many of its customer base to turn things around."

The analysis goes on: "J.C. Penney needs a major reinvention. Soltau has solid ideas as to how to do that, but plans require money, and her chain has essentially none of that. Call it a slow death or a managed shutdown, but there's no future for J.C. Penney. It's hard to picture a deep-pocketed savior stepping up to pay the billions needed to give the company a chance. Barring that, the only question is how long the company will survive."
KC's View:

I guess if I were working for JC Penney, my main job would be updating my resume and LinkedIn page.