J.C. Penney’s turnaround efforts, the latest ones at least, seem to actually be paying off.
The past few years have been a struggle for the retailer: They saw the failure of an elaborate turnaround plan by CEO Ron Johnson, the firing of Ron Johnson, the return of former CEO Mike Ullman, a commercial begging customers to come back, the hiring of former Saks CEO Stephen Sadove as board director and, most recently, the shuttering of 33 locations.
On Tuesday, the company reported comparable store sales growth of 3.1 percent for the holiday period (November and December) over the same period last year — which is more than analysts had predicted, and just a smidge below the holiday growth of competitor Macy’s. For the full quarter, sales rose approximately 2 percent, marking the first time since the second quarter of 2011 that J.C. Penney has generated a positive quarterly sales result.
Sales gains were most significant online: They came in at 26.3 percent over last year.
Rather than completely revamp store concepts, eliminate promotions and launch an overwhelming number of designer collaborations and shop-in-shops as Johnson did, Ullman has taken a less radical approach to his turnaround efforts, instead focusing on basics and key items, customer service and e-commerce.
“While 2013 brought a lot of change and challenges to J.C. Penney, the steady improvements in our business show that the company’s turnaround is on track,” said Ullman in a statement. “In spite of the significant headwinds facing all retailers this season, including unprecedented harsh weather conditions in many parts of the country, we delivered on our promise to generate positive comparable store sales growth in the fourth quarter.”
Ullman still has a lot to make up for, but the sales growth is obviously a good sign for a retailer that, for a second there, looked like it may never come back.