...In searching the web I came across a few articles that spoke to the JC Penny Company Inc. somewhat recent change in business strategy and the effects it has had with their customer base and business overall. In February of 2012, JC Penny launched an entirely new pricing strategy for their department stores where they were going to introduce a new technique titled “Fair and Square” pricing. This approach would basically do away with seasonal/impromptu sales along with the use of coupons. Instead their pricing on products in the stores and online were going to be at an everyday low price. In conjunction with this strategy, the retailer was going to introduce new brands to their retail store fronts (i.e. “Martha Stewart and l'amour nanette lepore”) which include a store within a store concept further distinguishing and separating the products/brands within their stores. Further detail can be referenced via the following link:http://ir.jcpenney.com/phoenix.zhtml?c=70528&p=irolnewsCompanyArticle&ID=1652614&highlight. Although these changes seemed positive and progressive at first, once implemented it had quite an adverse effect on their business overall and as a result sales have continued to suffer going into early 2013. In fact, when fourth quarter sales information was released, it showed JC Penny department sales being down 32% year over year. (Blodget, 2013. Para. 2). It was apparent that there was a disconnect between the company’s newly implemented changes/vision, and...
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...Penney was incorporated. It started out with 34 stores and 20 shareholders (Elizabeth, 2010). The shareholders were store managers, former partners, Mr. Penney as the president and major shareholder. JC Penney became a public traded listed company on the New York Stock Exchange in 1927 (Encyclopedia Britannica, Inc, 2012).The headquarter is located in Plano, TX, and operates in the United States and Puerto Rico, with more than 1,100 stores and counting. JCPenney merchandises include Women’s, Kid’s, Home, Shoes, Men’s Clothing, and Bed & Bath. My role is an organization consultant. I will provide new idea to JCPenney on how they can become more profitable to consumers again. To improve sales and their image, JC Penny close their catalog business, outlet stores, exit the drug store business, and closed under-performing stores (Booten, 2011). With this reformation, many people were laid off. Problem Statement JCPenny had set the top company priority as making sales for the quarter. With downsizing, JCPenney changed their image and logos. Figure 1 display the logos for JC Penney over the years. The problem that JC Penny is facing is consumer spending. The majority of their customers were middle-class American who lost their job in the Recession of 2009. With most companies, JC Penny did not change with the time. It was struck in their old ways of during business. As a major...
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...Company Analysis and Comparison: JC Penney (JCP) and Target (TGT) Becky Kennedy FINC 350 A Professor Mason February 1, 2015 JC Penney and Target are a huge presence in the retail industry. Both companies specialize in the sale of merchandise and service to consumers through retail stores and e-commerce. Target and JC Penney are companies that are part of an industry known for its competitiveness and few barriers to entry. They compete with other local, national and regional retailers for resources such as customers, employees, locations, merchandise, and other aspects of the retail business. Both companies have stores at several locations throughout the United States, with both company’s operating results depending on their ability to predict and respond to changes in trends and customer preferences by providing consumers with quality merchandise at competitive prices. Both companies face the same kinds of risks. The answers are in the way they are managed. The retail industry is risky with Target and JC Penney both struggling with issues resulting in lost revenue. Risks faced by companies in the retail industry most likely include competition, marketing, branding, employee/customer retention, supply chain management, financial management, data management and much more. Target suffered from a data breach at the end of 2013 that proved to be costly and they are still subject to investigations and private litigations costing them millions of dollars. JC Penney has suffered...
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...While some of the department stores covered by this Survey beat our same-store sales estimates for the first half of 2011, some lagged behind. (For details, see the “Same-Store Sales of Selected Department Stores and Discounters” table on the previous page.) Most of the moderate-price department stores such as J.C. Penney and Kohl’s fell behind expectations. On the other hand, discounters such as Dollar Tree Stores and Dollar General reported relatively strong gains in the first and second quarters of 2011. The better department stores such as Saks and Nordstrom have been able to attract upper-income households with limited sales promotions, by offering convenience and a superior shopping experience. These stores are sticking to their core strategies: they are actively striving to come up with innovative marketing programs and customer services, and selling exclusive designer products. (Adams Media Research, 2012) [pic] J.C. Penney and Kohl’s both posted modest sales gains in the first and second quarters. While middle-income consumers are showing reasonable caution in their spending behavior, they’re willing to go slightly over budget when the merchandise is right. Overall, discounters exceeded our same-store sales expectations for the first half of 2011, reflecting stable consumer demand for everyday necessities. Among the big box discounters, we believe Target benefited from an expanded assortment of food and allied categories. We also think the company...
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...J.C. Penney’s Real Problem: The Shrinking Middle Class * Rita McGrath April 12, 2013 Ron Johnson’s office seat has barely cooled off following his departure as business observers everywhere dissect what went so dreadfully wrong at J.C. Penney. The former Apple executive was too Silicon Valley for the Plano, Texas, retailer. He was arrogant. He didn’t test his ideas, maintaining the Apple mantra that customers don’t know what they want until you show it to them. He approved marketing campaigns that told loyal Penney’s shoppers that “you deserve to look better,” basically telling them that they looked less than glamorous wearing the brand they had trusted and been comfortable with for years. He hoarded information so that individual store merchandisers didn’t know how various lines were performing. He mocked J.C. Penney’s ways of doing things. He abandoned the discounting customers had come to expect from retailers. And he, and most of the team he recruited, were commuter leaders, jetting back to California after cramming in marathon work sessions at headquarters. These factors certainly couldn’t have helped. I think, however, there’s one major reason behind J.C. Penney’s sudden swoon that not enough commentators are picking up on. There’s one big reason JCP would never be “Bloomingdale’s for the mass market,” as Johnson wanted it to be, and that’s because the mass market is gone. Because the middle class is gone, or at least rapidly going. This reflects a troubling development...
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...230.4 million 5,028,000 shrs 10.82B $28.3 1.32 Valuation (per share) Current Price Comparables DCF Analysis Residual Income DD Analysis Abnormal Earnings $34.78 $36.60 $36.94 $38.38 $27.97 $46.49 Summary Financials (in millions) for 2004 Revenue Earnings $36.6 billion $550 million 1 Executive Summary Sears is following a differentiated approach in a competitive industry. Consequently, Sears has lagged behind other broadline retailers such as K-Mart, Target, and Wal-Mart. Should Sears adjust its marketing approach, it would have great potential for success. Growth prospects for Sears include continuation and growth of sales and expansion. The development of subsidiary brands such as Lands’ End and the acquiring of 61 of-mall stores from K-Mart and Wal-Mart. of new stores abroad will fuel this growth. Financing the acquisitions should not be overly burdensome for Sears, given the company’s large cash. Also, the company’s Z-Score of 5.9 will provide easy access to financing if needed Sears has began to shift to an off-mall emphasis for its stores as it acquired stores from K-Mart and Wal-Mart. It has named this process Sears Grand and it is progressing well for the company. This shift in emphasis will also sustain Sears’ growth. Sears performance is highly correlated to market factors. It is subject cycles in the industry as well as economic fluctuation in the system as a whole. Sears’ sales are highly seasonal and the company...
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...J.C. Penny Corporation, Inc. Company Analysis and Prognosis Tasha Liberman CASE STUDY BACKGROUNDER #2 MGMT 498 nd July 22 , 2013 Table of Contents Introduction .............................................................................................................................. 1 Company & Industry Background...................................................................................... 1 Company Strategies ............................................................................................................ 1-2 Current Financial Performance.......................................................................................... 2 Financial Performance Compare to Sub-Sector ........................................................ 2-3 Primary Macro-Level Forces ............................................................................................... 3 Micro-Level Forces.................................................................................................................. 4 Primary Strengths and Weaknesses ................................................................................. 4 Risk and Rewards Potential................................................................................
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...Financial Analysis of Jc Penny A brief overview of the rebrand Financial Analysis of Jc Penny A brief overview of the rebrand History J.C. Penney Company, Inc has about 1,100 stores in all 50 states. J.C. Penney Company, Inc. (JCPenney) is the second largest department store in the United States behind Sears Roebuck. JCPenneys’ name came from James Cash Penney who started his first retail store in 1902 in Kemmerer, Wyoming, a small mining town when his was 26 years old called Golden Rule. Even though the local banker cautioned Penney against opening a "cash only" store, since three other previous investor attempts failed, Penney still proceeded. In Penney's 1st year, the store successfully made $28,898 in sales. By 1913, Penney changed the company’s name to J.C. Penney Company, Inc. and moved the corporate headquarters to New York City to be closer to manufacturers and suppliers. Private label brands were a major reason for the success of the company; JC Penney could determine the price and used this to increase his profit margin. Some private label examples include Belle Isle, Ramona, and Honor Brand. In 1929 the company was listed on the New York Stock Exchange. When the Great Depression hit, the company cut back its inventory and purchased goods at lower prices so it could pass the savings on to customers. The company's profits even increased during the Depression and the number of stores grew to 1,496. During World War II, Materials and merchandise were scarce...
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...February 25, 2010 Assignment 2 Porter’s Six Forces Analysis General Retail: Merchandise/Department Stores Prepared by: Yulia Petukhova ID# A30 The department store industry will be analyzed taking department stores as players, individual consumers as buyers, and manufacturers and distributors as the key suppliers. The Rivalry among existing firms High The period from the end of the 20th century up until now has been marked by the consolidation trend in the department store industry, characterized by major acquisitions by a few larger, powerful competitors, greatly intensifying the rivalry among them.9, 13 Since there are only a few of them in the industry, they tend to match each other’s steps in some way or another. After JC Penny introduced itself to Manhattan just a block away from Macy’s, it is only a matter of short time before Kohl’s will finally announce its move into Manhattan as well.10 Slowdown in the industry growth coupled with reduced consumer spending and low switching costs intensifies rivalry even further prompting the market players to differentiate their products by introducing exclusive brands and increasing innovation.3, 15, 17, 19, JC Penny contracted Cindy Crawford to extend her jewelry brand exclusively at their stores, while Macy’s has signed a strategic alliance agreement to become an exclusive retailer of Ellen Tracy branded women’s sportswear in spring 2010...
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...Avon Products, Inc. (Avon) is based in New York. The firm engages in the manufacture and marketing of beauty and complimentary products primarily in North America, Latin America, Europe, and Asia Pacific (Yahoo Finance, 2005). Avon's products are classified into three product categories: Beauty, Beauty Plus, and Beyond Beauty. The Beauty category consists of cosmetics, fragrances, skin care, and toiletries; Beauty Plus includes fashion jewelry, watches, apparel, and accessories; and Beyond Beauty comprises home products, gift and decorative products, candles, and toys (Ibid). The company sells and markets its products through a combination of direct selling, marketing by independent Avon representatives, and via its consumer Web site, avon.com. This paper will explore how the company is fairing under the leadership of its current CEO, Andrea Jung. There are two opposing views regarding the company's current and future success. One group feels that the firm has a promising future with Jung at the helm while the other group does not. This paper will analyze the pros and cons uncovered by each team member and discuss which view prevailed in the debate and why. Pros and Cons Pros of Jung and Avon Andrea Jung became president and CEO of Avon in 1999 and has totally revamped the company. Under her leadership, the company has updated its product line, launched new advertising, and created a new image (Fact Monster, 2005). Avon's sales have increased by 30 %, profits 40%, and...
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...SWOT ANALYSIS A SWOT analysis strives to determine the current strengths and weaknesses within a firm, as well as the opportunities and threats facing the firm (SWOT = strengths, weaknesses, opportunities, threats). A SWOT analysis is a powerful tool to evaluate the current position of the firm within its broader business environment. It is an evaluation undertaken by senior staff or the owner of the firm. It needs to be as honest an appraisal as possible. Environmental factors internal to the company can be classified as strengths or weaknesses, and those external to the company can be classified as opportunities or threats. The Indian Textile industry adds 14% to the industrial production and 8% to the GDP of India. It provides employment to 38 million people and thus, is the second largest employment provider after agriculture. The Indian Apparel & Textile Industry is one of the largest sources of foreign exchange flow into the country with the apparel exports accounting for almost 21% of the total exports of the country INTERNAL FACTORS STRENGTHS : Strengths describe the activities that an organization does well and that set it apart from competitors. It is an inherent capability of the company which it can use to gain strategic advantage over its competitors. Strengths of an export house are as follows: 1) The Latest and best machines: Manufacturing An innovative team under mature infrastructure is the pride of Shahi in fashion industry. They have...
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...WAL MART Financial Analysis Managerial Finance FI515 Keller Graduate School of Management of DeVry University Introduction and Overview The history of Wal-Mart can be traced back to 1940s when Sam Walton began his career in retail at JC Penny. Walton would only stay at JC Penny for 18 months before begging his career as a entrepreneur. On May 9, 1950, Walton purchased a store from Luther E. Harrison in Bentonville, Arkansas, and opened Walton's 5 & 10. Thus, the Ozark Mountain town of 2,900 residents would become the headquarters for the world's largest retailer. By 1962, he had eleven Walton's stores Inspired by the successes of other discount department store chains, Walton opened the first store in his own discount chain in Rogers, Arkansas that year. Responsible for the purchase and maintenance of signage, Walton's assistant, Bob Bogle, came up with the name "Wal-Mart" for the new chain. By 1967, the company grew to 24 stores across the state of Arkansas, and had reached $12.6 million in sales, and by 1968, the company opened its first stores outside of Arkansas in Sikeston, Missouri and Claremore, Oklahoma. In February 1988, Sam Walton stepped down as Chief Executive Officer, and David Glass was named to succeed him. Walton remained on as Chairman of the Corporate Board of Directors, and the company also restructured their senior management positions, elevating a cadre of executives to positions of greater responsibility...
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...To: Miranda Priestly, Brand Manager From: Subomi Y. Johnson Date: April 27, 2009 Re: Analysis and Recommendations for Seventeen Magazine v. Teen Vogue ____________________________________________________________ _________________ In regards to my current assignment, I have conducted detailed analysis of Seventeen Magazine in comparison to Teen Vogue Magazine. In this project I have also included an industry analysis for teenage girl magazines in 2009 and an overview of the marketing mix for both our brand Seventeen as well as Teen Vogue. In conclusion, I have proposed 3 recommendations to better target our audience, build better brand equity, as well as expanding our distribution channels. These recommendations include narrowing our target market, creating a television show, and building a brand store. Thank you giving me this opportunity to analyze the industry and marketing mixes of both brands. In addition, I hope that my three recommendations will better the company in the future. If you have any questions please feel free to contact me at sj7613a@american.edu or by telephone at 202-384-9364 Attachment: Industry Analysis, Marketing Mix, and Brand Recommendations Part 1 Magazine Industry Overview The magazine industry is a very diverse business venture as it is full of multiple segments for its various target audiences. The teen market is full of recognizable names such as the pioneer of teen magazines, Seventeen established...
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...Estee Lauder Inc. is one of the most successful and most popular cosmetic brands in a very competitor cosmetic industry. In this analysis we have determined the top competitors for Estee Lauder by extrapolating a list of key criteria. The first key criterion is market share. Market share is essential in determining how each of Estee Lauder’s competitors is like to capture more or less share of the cosmetic industry based on the competitor’s current position in the market. The next criterion we examined is gross revenue, which is similar to market share in determining how large or small competitors are compared to Estee Lauder based on earnings. Another criterion is quality, this criterion is more subjective; however, we confidently believe that quality could be based on pricing, location, and availability of products. Moreover, Estee Lauder’s competitors may have a higher or lower quality product compared to Estee Lauder based on these factors. After considering these criteria, we have determined seven major competitors, three of which are considered major competitor while the other four would be considered less competitive competitors. Among the seven competitors Procter & Gamble, Avon, L’oreal, Coty Inc, Revlon, Shishedo, Bare Essential, the top three competitors that are fit in our criteria in cosmetic and personal care product manufacturing industry are Procter & Gamble, L’Oreal, and Coty Inc. The first reason is that their market capitals are very competitive. Based on...
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...6-10 Chapter 1: The Nature of Operations Diversity and the Importance of Operations Investment in Operations => Profit 1. Upfront improvements in operations can simultaneously lower costs and improve customer satisfaction. 2. Improvements in Operations often depend on advances in technology 3. Improvements in operations can obtain a competitive advantage by improving operations 4. Diversity of Operations Main issue=> Initial investment= >benefit in the long run Operations create value at every point in value chains 1. Operations are the heart of every organization. 2. Operations are the tasks that create value. See Diagram that explains the SWOT Analysis. Strengths and Weaknesses => Internal Opportunities and Threats => External Ex) SWOT Analysis Think about the scenario of email versus the post office. With advances in technology, the invention of email has taken over the need for using the post office for post mail. Systems Perspective (pg 7) A) Inputs – capital / equipment / supplies / knowledge / material / facilities / labor / time B) Transformation – creating value by: a. Alter – Changing something structurally – physical, sensual, psychologically b. Transport – Relocating something to a new location c. Store – Enhancing value by securing items d. Inspect – Enhancing value by inspecting quality and functional ability e. C) Outputs – Facilitating goods (products) &...
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