JCPenny is closing down stores over the next couple of years as part of its Chapter 11 bankruptcy restructuring business plan.
The restructuring plan will have JCPenney closing down a total of 242 locations. To give that some perspective, the company currently operates 846 stores. That means this reduction will cut its store footprint by almost 30%.
According to JCPenney, the stores closing are those not performing among its best. Its fiscal year 2019 revenue was $9.2 billion from all stores. By removing these underperforming stores, it’s revenue only drops about 20% to $7.5 billion.
JCPenny notes that the stores remaining open are those with “positive trending historical comps, low competitive pressure, and high target income demo representation.” They also give it a nationwide portfolio with a focus on the Midwest, South, and Southeast.
Prior to this announcement, JCPenney stores closing in 2020 were limited. The company’s previous update only had it planning to shut down a total of six stores this year. However, the novel coronavirus pandemic has been trouble for retailers with stores being closed to the public.
Alongside the JCPenny stores closing announcement are other plans for the company. That includes a shift in focus that will have it beefing up its e-commerce business. The company is also looking to increase traffic and sales by introducing more personalized shopping experiences for its customers. As such, it plans to beef up its loyalty program to bring back its biggest shoppers.
As of this writing, William White did not hold a position in any of the aforementioned securities.