JC Penney stores in U.P. to close
By Graham Jaehnig
Houghton Daily Mining Gazette
HOUGHTON — JC Penney Corp. will begin liquidating its Houghton outlet on April 17 of this year, according to the corporation.
In an effort to reduce costs and build sales, the corporation announced in February it would close up to 140 this year. On Friday, the company announced that 138 stores will be closed.
All of Penney’s stores in the Upper Peninsula — located in Houghton, Escanaba, Kingsford and Sault Ste. Marie — will be closed.
The February statement from JC Penney followed similar announcements from Sears and Macy’s. Like other department stores, J.C. Penney Co. is hurting as more people shop online instead of heading to the mall. The closures are part of the company’s previously announced plans to focus on its best-performing stores.
“We believe closing stores will also allow us to adjust our business to effectively compete against the growing threat of online retailers,” Marvin R. Ellison, chairman and chief executive officers of JC Penny said in a Feb. 24 statement.
Friday’s action underscores the growing impact online retailers are having on brick-and-mortor retailers across the country. In the statement, Ellison said the company is pleased with the double-digit growth of jcpenney.com.
The JC Penney February release stated in 2016, approximately 75 percent of all online orders touched a physical store.
“Even with a reduced store count, JC Penney is competitively positioned to deliver a differentiated department store model that meets the expectations of a digital world with an inspiring, tangible shopping environment,” Ellison stated in the release.
Nine stores will close in Texas, the most of any state. Eight will close in Minnesota and seven will be shut in both Michigan and Pennsylvania.
Penney’s expects to save roughly $200 million a year by exiting these locations, according to CNBC News, which contributed less than 5 percent of its annual sales. It plans to invest in its best stores and digital operations while whittling down $4.3 billion in long-term debt.
As a result of the store closures, the company announced, the distribution center in Lakeland, Florida will close in early June, at which time operations will transfer to the company’s logistics center in Atlanta. In addition, the company is in the process of selling its supply chain facility in Buena Park.
The closings will leave J.C. Penney with a total of about 900 stores.
Associates who will be impacted by the store and distribution center closures will receive separation benefits, which includes assistance identifying other opportunities and outplacement services, such as resume writing and interview preparation, the release states. Roughly 5,000 will be affected by the closures.
Eligibility for the Voluntary Early Retirement Program will will generally include home office, stores and supply chain personnel will effect another 6,000 employees, the release stated.
In attempting to interview the manager of the Houghton outlet, she stated only, “We have no comment to make.”
The Associated Press contributed to this story.