Struggling department store chain JCPenney is closing down 138 stores and two distribution centers in the US in a move to cut costs, boost sales at stronger locations and focus on e-commerce.
About 5,000 workers will be impacted by the national store closings, most of which are slated for June 2017. The company had about 105,000 full and part-time employees last year.
“We believe closing stores will allow us to adjust our business to effectively compete against the growing threat of online retailers,” said JCPenney chairman and CEO, Marvin R. Ellison, in an announcement in February 2017.
“I believe the future of the retail industry will include companies that can seamlessly combine their bricks-and-mortar presences with their online platforms,” he added.
The biggest cuts are set to take place in Texas and Minnesota where the company plans to shutter nine and eight retail locations respectively.
The cuts represent about 14 per cent of JCPenney’s overall store portfolio that produces about 5 per cent of its total annual sales. Apart from this, JCPenney will also shutter a supply-chain facility in Lakeland, Florida and relocate another in Buena Park, California.
The closings will leave JCPenney with a total of about 900 stores.
The move, says JCPenney, is a bid to cut costs, boost sales at stronger locations and shift focus on to e-commerce
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