J.C. Penney to close up to 140 stores, offer buyouts

[Brandon]

Somebody expalin this to me.

How does it make sense to announce you are closing "130 to 140" of your c.1000 stores, without a list?  I would think that the best workers would not want the risk of suddenly being out of work along with everybody else in the store and would thus do the "bird in the hand" idea and get another job now.  I would also think that most customers would anticipate a "going out of business" blow out sale and withhold current purchases.

The list will be announced in mid-March.  JCPenney is probably currently identifying its lowest performing locations.

According to MarketWatch, many of the closures will be smaller stores in rural areas:
http://www.marketwatch.com/story/jc-penney-to-close-130-to-140-stores-sales-dip-2017-02-24-12485289

What's interesting is that the CEO wants a broader base than the apparel.  The move into home appliances, IMHO, makes sense with the weakness of Sears.  The original reason Penney's got out of appliances in 1983 was the strength of both Sears and Montgomery Ward in that area (same with auto centers).  With Ward's gone and Sears weak, it makes sense to move back into there again.  Having seen the department at my local Penney's, it's like the appliance departments at Best Buy, HH Gregg, and Home Depot (no surprise there); all of which are very nice and easy to navigate, unlike the rows of appliances at Sears or Menards (in fact, I think I found my new fridge there - gotta save up enough for it).

As a side note, I was just in my local mall (Louis Joliet Mall), and I noticed that three of the four anchors were busy (4:30 pm on a Sunday).  Carson's had a decent amount of people.  Macy's even had people with bags going in and out.  Penney's (where I shopped), had a steady stream of customers three to four deep at each register, but moving quickly.  Sears, on the other hand, for lack of a better term, was dead.  It was even obvious traffic-wise in the mall itself.  Most of the mall was actually pretty crowded, but the Sears wing had very little traffic, even with the MC Sports and Family Christian going-out-of-business sales (both are right next to Sears in the Sears court).

[Pink Jazz]

Somebody expalin this to me.

How does it make sense to announce you are closing "130 to 140" of your c.1000 stores, without a list?  I would think that the best workers would not want the risk of suddenly being out of work along with everybody else in the store and would thus do the "bird in the hand" idea and get another job now.  I would also think that most customers would anticipate a "going out of business" blow out sale and withhold current purchases.

The list will be announced in mid-March.  JCPenney is probably currently identifying its lowest performing locations.

According to MarketWatch, many of the closures will be smaller stores in rural areas:
http://www.marketwatch.com/story/jc-penney-to-close-130-to-140-stores-sales-dip-2017-02-24-12485289

What's interesting is that the CEO wants a broader base than the apparel.  The move into home appliances, IMHO, makes sense with the weakness of Sears.  The original reason Penney's got out of appliances in 1983 was the strength of both Sears and Montgomery Ward in that area (same with auto centers).  With Ward's gone and Sears weak, it makes sense to move back into there again.  Having seen the department at my local Penney's, it's like the appliance departments at Best Buy, HH Gregg, and Home Depot (no surprise there); all of which are very nice and easy to navigate, unlike the rows of appliances at Sears or Menards (in fact, I think I found my new fridge there - gotta save up enough for it).

As a side note, I was just in my local mall (Louis Joliet Mall), and I noticed that three of the four anchors were busy (4:30 pm on a Sunday).  Carson's had a decent amount of people.  Macy's even had people with bags going in and out.  Penney's (where I shopped), had a steady stream of customers three to four deep at each register, but moving quickly.  Sears, on the other hand, for lack of a better term, was dead.  It was even obvious traffic-wise in the mall itself.  Most of the mall was actually pretty crowded, but the Sears wing had very little traffic, even with the MC Sports and Family Christian going-out-of-business sales (both are right next to Sears in the Sears court).

I have noticed that in our local malls (Superstition Springs Center, Chandler Fashion Center) too that Sears is generally the least crowded of the anchor stores.

[rawmustard]

The list is out. Notable at least for my area is the store at Lakeview Square Mall, which is already losing its Macy's.

http://www.jcpnewsroom.com/news-releases/2017/assets/0317_list_of_store_closures.pdf

[inkyatari]

No surprise that Peru Mall in Peru, IL is a location set to close.

Good to see the freestanding in Matteson IL is staying.

(semi-unrelated topic, Lincoln Mall in Matteson was ordered by a judge in February to be torn down immediately. Lincoln Mall used to have a JCP. It closed,and two years later, they built a freestanding behind the mall  http://www.chicagotribune.com/suburbs/daily-southtown/news/ct-sta-lincoln-mall-demolition-st-0316-20170316-story.html)

[Brandon]

Looks mostly like a rural purge of small stores.  Makes some sense if the object is to expand the offerings, including appliances in the stores.  Very surprised not to see Sandburg Mall (Galesburg) or Alton Square (Alton) on the list.

[Pink Jazz]

Luckily none of the Phoenix area stores made the list of closures.  The only store in Arizona that is closing is the Riverview Mall location in Bullhead City.

Interestingly, even though it was listed on Morningstar Credit Ratings vulnerable locations, the location at El Con Center in Tucson is not included on the closure list.

[hbelkins]

None in Kentucky being closed.

[lordsutch]

Looks mostly like a rural purge of small stores.  Makes some sense if the object is to expand the offerings, including appliances in the stores.  Very surprised not to see Sandburg Mall (Galesburg) or Alton Square (Alton) on the list.

Yep (I noticed places like Dublin and Tifton, GA and Oxford, MS), along with killing off stores in dying malls like the Macon Mall here.

[jp the roadgeek]

Surprised CT Post Mall Penneys is closing.  Guess they felt it was too close to Trumbull.  I thought the freestanding Torrington one would bite the dust.

[Avalanchez71]

http://www.cnbc.com/2017/02/24/jc-penney-earnings-q4-2016.html


http://www.usatoday.com/story/money/2017/02/24/jc-penney-store-closures/98344540/


Wow They were once the biggest stores but now falling apart.

Belk has a good selection of Big and Tall.  Of course it would be online for you since you are not in their footprint.  They have really good deals on clearance as well.

[hbelkins]

Belk has a good selection of Big and Tall.  Of course it would be online for you since you are not in their footprint.  They have really good deals on clearance as well.

That's handy for me to know. (Says the guy who remembers when they were Belk-Simpson.)

[slorydn1]

It looks like the only one of the stores that are closing that I have been to is the one in the Blue Ridge Mall in Hendersonville NC. Granted, I haven't been in that store since 1999.

[Pink Jazz]

http://www.cnbc.com/2017/02/24/jc-penney-earnings-q4-2016.html


http://www.usatoday.com/story/money/2017/02/24/jc-penney-store-closures/98344540/


Wow They were once the biggest stores but now falling apart.

Belk has a good selection of Big and Tall.  Of course it would be online for you since you are not in their footprint.  They have really good deals on clearance as well.

I have occasionally bought some IZOD shirts online from Belk.  However, lately I have been buying several from BeallsFlorida.com due to their great deals and low shipping rates.

[Avalanchez71]

Any beauty item ships free.  They have buy one get two free mens pants until about 11:59 EST tonight as well.

[briantroutman]

Looks mostly like a rural purge of small stores.  Makes some sense if the object is to expand the offerings, including appliances in the stores.  Very surprised not to see Sandburg Mall (Galesburg) or Alton Square (Alton) on the list.

Perhaps that's true for many of JCPenney's closures, but in my home state, nearly half of the closures are in large, prosperous malls in the Philadelphia metro area: King of Prussia, Philadelphia Mills, and Willow Grove. Another JCPenney store in a similarly large and successful mall (Exton Square) closed a few years ago.

I can't say I'm surprised to see my hometown store (Lycoming Mall) on that list. You could probably count Williamsport as part of a rural purge, although considering that Lycoming is the only indoor mall serving a metro of about 117,000, it likely wasn't among the smallest or most rural on the list of closures.

Ironically, JCPenney was the last department store to defect from downtown Williamsport to the Lycoming Mall–over a decade after Sears and Woolworth had moved to the mall, and after local department stores like L. L. Stearns had given up the ghost. Now downtown Williamsport has undergone an incredible renaissance, and the mall is ailing.

Actually, I wonder what future the Lycoming Mall possibly has. The mall's Macy's is slated for closure. Now JCPenney. Should the mall's Sears follow suit, Lycoming's only remaining department store will be Bon-Ton–with three vacant anchors. I can't imagine any legitimate retailer filling any of those spaces except perhaps Boscov's, which seems to specialize in lost causes. I've seen instances where former mall anchors are replaced by junky flea markets, fly-by-night schlock retailers like Steve and Barry's, and even cheaply built indoor mini golf courses, and the result just prolongs the sad, slow death of an ultimately doomed mall.

The Lycoming Mall had been expanding outward for a number of years, attracting several outparcels surrounding the mall's parking lot (Best Buy, Pier 1, Sam's Club), most of which survive today–plus second outdoor shopping center anchored by a Target just off mall property. These have been joined by several restaurants, car dealerships, and other businesses–none of which existed prior to the mall. In an intersting parallel to cities that grew and suburbanized prior to an ultimate decline, these parasitic retailers may find themselves "suburbs"  of a core (the mall) that no longer exists in any meaningful way.

[bulldog1979]

My grandfather was the assistant manager of the JC Penney store in downtown Marquette back in the 1940s when he was dating and married to my grandmother. When I finally met him in 1988 on a trip of his back to Michigan, he remarked how the store in Ishpeming would run sales and undercut the prices at his store in Marquette. A few years later, corporate merged the two stores together and moved the combine operations out to the Westwood Mall when the mall expanded.

The former Ishpeming store's building was used for a few other enterprises before it was torn down a few years ago. The former downtown Marquette store was purchased by MFC First National Bank of Marquette (later MFC Bank, now Wells Fargo). Since both the main branch of the bank and the Penney's store are faced with the local sandstone, the bank was able to construct a breezeway to connect them and tie them together. The bank has offices upstairs in the old store building, and our local CVB operates a tourist information center out of the ground floor.

As for the fate of the Westwood Mall location? It closed in 2014. Now all of the remaining Upper Peninsula JC Penney locations are closing.

[doorknob60]

Wow, I had no idea Astoria, La Grande, Pendleton, The Dalles, OR, or Burley, ID even had JC Penney stores, and I've driven through the town of most of those. Guess I'm not surprised, they aren't exactly big cities, and I imagine the likes of Walmart and Fred Meyer (each of those cities has one or the other) ate into most of their market. Good to see the Nampa, ID location not closing. The area it is in is a pretty new and nice area (the hospital is opening a new full hospital there, and a new WinCo just opened, and it's right by the freeway), though the Macy's there just closed.

[Brandon]

Wow, I had no idea Astoria, La Grande, Pendleton, The Dalles, OR, or Burley, ID even had JC Penney stores, and I've driven through the town of most of those. Guess I'm not surprised, they aren't exactly big cities, and I imagine the likes of Walmart and Fred Meyer (each of those cities has one or the other) ate into most of their market. Good to see the Nampa, ID location not closing. The area it is in is a pretty new and nice area (the hospital is opening a new full hospital there, and a new WinCo just opened, and it's right by the freeway), though the Macy's there just closed.

I think a part of it is to do with size as well.  I noticed that many of these stores (King of Prussia notwithstanding) are under 50,000 SF in size, and many of them are 20,000 - 30,000 SF in size.  If the CEO is serious about adding more than apparel, then the smaller stores simply don't make sense anymore (they didn't even during the era they had the full-line stores [appliances, electronics, auto service, hardware, etc]).  To be able to have a Sephora and appliances in each store, they really need to be no less than 80,000 SF in size.

I think some of these closing are for poor sales, maybe 30-40 of them.  The rest are a purge of small rural stores, and even duplicate stores (see McAllen, TX - the downtown store is closing, but the much larger mall store only a couple miles away is being kept) or stores simply too close to each other.  Given what I've seen of Kohl's, I suspect they'll have to do something similar in the not-so-distant future.

[roadman65]

Wonder if JC Penney will outlive Sears?

[inkyatari]

Wonder if JC Penney will outlive Sears?

I believe they will.  I think they're adapting well, whereas Sears is being run into the ground by a dumbsh*t

[ET21]

Wonder if JC Penney will outlive Sears?

Yeah they should. JCP has at least tried ways to stay alive whereas Sears has been dying a slow painful death

[vdeane]

The JCPenney locations I've been too have been busy enough.  I think they're restructuring and refocusing on urban areas to compensate for the fact that people don't need to go to malls to buy clothes any more.  Contrast to Sears/Kmart, which is just throwing buzzwords around while everything shrinks, becomes more dilapidated, and generally dead and empty inside.