J C Penney Company Inc (NYSE:JCP) announced laying off an undisclosed number of corporate employees, after the announcement that it plans to shutter up to 140 stores, last month. And since they’ll be opening in fewer locations, it became necessary to adjust the staff relative to the company’s store portfolio, as per Joey Thomas, J.C. Penney’s spoken man. And regarding the number of the eliminated staff, this couldn’t be disclosed, but it’s the normal course of business for leaders over there to ensure their respective teams are optimally staffed.
J.C. Penney is actually shutting down about 13 – 14% of its stores, as these locations contributed less than 5% in annual sales. So closing these stores is necessary to make annual savings of about $200 million. List of stores to be closed is expected to be issued in mid-March after notifying the workers to be dismissed.
What About The Future Of The Affected Employees?
Marvin Ellison – J.C. Penney CEO – declared that the company is offering a voluntary early retirement program for the affected employees, to work from home. This is valid for store and supply chain employees who meet criteria based on age and years of service to the company. Eligible candidates must decide whether to accept or not on or before March 17th. Generally, this will increase the hiring rates at P.C. Jenney as the number of the full-time employees expected to accept the package will exceed the number of full-time positions affected by the store closures. Around 6,000 employees are eligible for retirement packages.
Downsizing But Expanding In A Different Way
J.C. Penney corporate office and Grass Valley store manager, Jennifer Ledbetter stated J.C. Penney is planning on adding Sephora in June. Sephora is a makeup center that features an assortment of beauty products, but this sort of expansion and moving forward didn’t mean the store was safe. J.C. Penney didn’t actually disclose which locations are closing down, but it’s expected to be released on a week. J.C. Penney also declared that in relation to other companies, the store’s e-commerce is not experiencing dramatically increasing fulfillment costs. However, they’re happy with the double-digit growth and how leveraging our brick and mortar locations is enabling them to offset the last-mile delivery cost.