J.C. Penney cutting 33 stores and 2,000 jobs; sales commission returns
J.C. Penney Co. is attempting to right-size itself by closing 33 under-performing stores around the country and eliminating 2,000 positions, the retailer said Wednesday.
The Plano, Texas, company said it hopes the effort will save $65 million a year beginning this year.
Units getting the ax will finish shutting down in early May. The only store closing in California is at Arrow Plaza in Rancho Cucamonga.
Chief Executive Myron Ullman said the cuts were necessary as part of J.C. Penney’s “progress toward long-term profitable growth.”
The company operates roughly 1,100 stores nationwide.
J.C. Penney has traveled a rough road retracing its steps to its pre-Ron Johnson state. Johnson, an Apple alum, was brought in as chief executive in November 2011 to jazz up the department chain’s staid reputation.
He left less than two years later after several straight quarters of tanking sales and consumer complaints over the disappearance of beloved discounts and store brands.
Now, the cycles of promotions are back, as are labels such as St. John’s Bay.
On Wednesday, spokeswoman Ann Marie Bishop confirmed that the company was reinstating a commission pay system for its salespeople in the window coverings, furniture and fine jewelry departments.
The switch is set to occur in February and March and will affect more than 3,000 employees.
“Offering a competitive salary base that includes a commission incentive not only helps in retaining some of our best sales associates, it motivates them to build and maintain stronger customer relationships,” Bishop said in an email.
J.C. Penney stock rose 1.2%, or 8 cents, to $7.01 a share during normal trading hours Wednesday, but then slipped 0.3%, or 2 cents, to $6.99 by early evening in New York.
In the last year, the stock has tumbled more than 60%.
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