April 17, 2017 in Latest News
Company spokeswoman Daphne Avila told CNBC on Thursday that the locations J.C. Penney announced in March would be closed have since seen “better-than-expected sales and traffic.”
“This is not an uncommon response when you announce a store closure,” Avila added. “Local shoppers will come out for a variety of reasons — some out of nostalgia and some who are just looking for a great deal.”
As a result, J.C. Penney will start liquidating those stores on May 22 instead of April 17, as first planned. And stores will shutter by July 31, instead of mid-June.
“Meanwhile, it’s advantageous for the company to continue selling through spring and summer merchandise at current promotional levels by pushing liquidation back another month,” the company told the Dallas Business Journal.
J.C. Penney first announced in February plans to shut down 13 to 14 percent of its 1,014-store fleet, and two distribution centers in Lakeland, Florida, and Buena Park, California.
At the time, the Plano retailer said the stores it planned to shutter accounted for less than 5 percent of annual sales and no profit dollars.
Closing them is expected to generate annual savings of roughly $200 million, though J.C. Penney expects to incur $225 million in pre-tax charges during the first half of 2017.
J.C. Penney decided what stores to close after evaluating their financials and whether they met the “brand standard,” CEO Marvin Ellison said.
“ For the record, I think that 1,014 stores for J.C. Penney is too many, because we haven’t made the necessary investments in our store fleet the way we should,” Ellison said in January. “It’s a simple question: If we have a location that I wouldn’t want my children to work at, or wouldn’t want my wife to shop at, then we’re going to invest capital and ask if it fits the brand standard.”