Can J.C. Penney Tame This Losing Streak?
Following a steep decline in profits and a dramatic loss for the year, retailer J.C. Penney (NYSE:JCP) has been struggling to reinvent itself and implement a series of measures that are intended to turn the company around. However, though a turnaround is expected, the benefits and results of the measures taken may not show themselves for longer than anticipated, Reuters is reporting.
Discounts and coupons were largely responsible for last year’s losses, and resulted in the company doing away with them to pursue a more effective sales strategy. It also has opened the first “shops within its stores,” a program that rents space within the J.C. Penney stores to independent shops to help lure consumers.
“It may take longer than expected or planned to recover from our negative sales trends and operating results, and actual results may be materially less than planned,” the company wrote in its annual report. The news is not positive for J.C. Penney shareholders, but is not surprising, either. Despite strong gains in the American economy so far this year, retail has slogged through with very little growth in proportion to other aspects of the economy.