Monday, April 15, 2013
The turnaround that is not working (yet?)-2
I am saying yet in parentheses because it still might happen but the way it was executed, it seems to me that it will not happen. Learning a lesson for USD 1 Billion (the amount supposedly lost by the company), I now believe that it will be a long time before they will even try this strategy again. Meanwhile on the other front, Macys ® another big chain retailer is suing a supplier stating that Macys ® have exclusive relationship with it and it cannot supply to JCP. Now the problem is that JCP has supposedly about USD 100 million in inventory of that supplier and if it loses the case then it will have to destroy them (All this information is public and you can read it in any newspaper). So the turnaround that was supposed to be savior of JCP has become a nightmare for them. JCP was trying to bring a new and young crowd to the store and in the process have alienated its loyal customers. It seems like all the effort that they have done in the past year or so (with the exception of a few) will be unraveling in the coming months. JCP have to stop reinventing the retail business since they have no more leeway to experiment with the money they have on hand right now. They have to bring back all the sales and discount and start courting their core customers and also try their stores a go to place like other retailers do, otherwise they will always be the also ran in the retail business.