J.C. Penney (JCP) plans to close 130 to 140 stores and offer buyouts to 6,000 workers as the department-store industry sags in competition with online sellers and nimble niche retailers.
The company said Friday that it would shutter 13% to 14% of its locations and introduce new goods and services aimed at the shifting preferences of its customer base.
The cuts come amid mounting challenges for once-stalwart department-store chains such as Macy’s and Sears, which are aggressively closing stores and shedding costs as shoppers flock to alternatives.
“It became apparent to us that our footprint was too large,” Penney CEO Marvin Ellison told investors, and the closures will “allow us to raise the overall brand standard of J.C. Penney” and invest in remaining stores.
A list of stores to close will be released in mid-March, and liquidation sales are expected to take place in the first or second quarter.
Online competition, fast-fashion retailers such as H&M and Forever 21 and discounters such as T.J. Maxx have undermined Penney’s business. CEO Marvin Ellison said the company is responding by overhauling its products.
Penney is adding toys, beauty products, appliances and home goods as it tries to appeal to a customer base made up of 70% women and 70% homeowners
The appliances push, paired with the introduction of new home installation services, is targeted at swiping business from ailing competitor Sears.
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