According to a 2018 Women’s Wear Daily report, J.C. Penney Co., struggling to turn itself around, will be cutting inventory, doubling down on catering to its core middle-aged female customer, and seizing opportunities in categories new to the business, namely baby products, toys and workwear.
The chain plans to reduce inventory by at least $250 million by the end of fiscal 2019, as part of the evolving strategy for the ailing $12 billion department store.
“It is critical for us to better manage our inventory levels, and focus on providing our core customers the assortment and shopping experience she expects from J.C. Penney,” said Jeffrey Davis, Penney’s chief financial officer, who outlined the turnaround strategy just after the company posted poor results for the second quarter, which seemed all the more disappointing in light of the strong results posted this week by Walmart while Macy’s showed good bottom-line improvement, according to a 2018 Women’s Wear Daily report.
According to a 2018 CNBC report, Davis said that the department store has “changed its approach to inventory management from ‘buying to store capacity’ to ‘buying and chasing’ into demonstrated sales trends.” It is slashing the prices of products that have not sold, this time to clear its shelves for fall and back-to-school inventory.
The company told analysts Thursday morning on a conference call that it expects to reduce its total inventory by at least $250 million.
It also said it is establishing “several new partnerships” to improve its buying process, ensure its products are more on trend and better display its merchandise. JC Penney has been focusing streamlining its products to cater to its core customers — women in the range of 45 to 55 and older — after a period in which it sought younger shoppers, according to a 2018 CNBC report.
In March, it eliminated 230 positions and announced the departure of executive vice president of Penney’s omnichannel business, Mike Amend. Last year, it closed more than 100 stores, according to a 2018 CNBC report.