The JCPenney saga continues with new/old CEO Mike Ullman setting the stage for his attempt to revive the retailer after former CEO Ron Johnson's turnaround attempts backfired in a big way, resulting in his departure from the company and a $985 million loss.
The latest update: Sales trends are improving under Ullman, reports WWD. And the current focus is, unsurprisingly, on the holidays. In fact, he says, the retailer will "definitely be a force to be reckoned with" over these crucial next two months.
Ullman's plans are pretty basic and not revolutionary, which is probably what the company needs. Johnson's experimental initiatives, like eliminating promotions, introducing tons of designer collaborations at once, and reconfiguring floor plans, seemed too much for shoppers and shareholders to wrap their heads around.
"There are promotions because that is the way customers expect to shop for family and friends," Ullman told the trade. "We are well positioned to compete.”
We wonder if that means opening on Thanksgiving Day like competitor Macy's? Ullman would not confirm, but based on his determination to "not let anyone take our business away," we'd almost be surprised if he didn't.
In terms of product, they're focusing on "basics, key items and sizes," and Ullman noted that the Joe Fresh shop-in-shops are doing well, as well as the women's apparel category as a whole.
Another important area in which the retailer has seen improvements is e-commerce. Online sales were up 25.3% in September. But they're also focusing on customer service in-store, which Ullman says is "the highest it’s ever been in the history of the company.…They want to prove to everyone J.C. Penney is not only viable, it is vibrant."
Other efforts are focused on cleaning up messes created by the previous management, like excess inventory and less confident lenders.
While small improvements are there, it remains to be seen whether a full turnaround will actually be possible. These next couple of months will obviously be crucial.
Update: In a pretty significant move, JCPenney has brought on Saks CEO Stephen Sadove to help with its turnaround. Sadove announced recently that he would be leaving Saks once its acquisition by Hudson's Bay Co. was complete. He'll be named JCPenney's board director.
It will be interesting to see how his experience in luxury retail will impact JCP's future.