The company hopes to breathe new life into business by incorporating more home products
May 10, 2016
JC Penney has been struggling as of late. Fresh on the heels of its attempted recovery, the New York Post reported that the company eliminated jobs and froze overtime due to unexpected light sales in April.
Now, perhaps in another attempt at reinvigoration, Penneys is getting into the business of selling appliances. This July, the company will begin rolling out appliance showrooms at nearly 500locations.
The showrooms (as well as jcp.com) will include kitchen and laundry appliances from Samsung, LG, GE Appliances, and Hotpoint.
Aligns with consumer spending
The decision to incorporate home products and an appliance showroom was a strategic one. According to JC Penneys chief executive officer, Marvin R. Ellison, the decision was based largely on opportunities afforded by the current housing market.
"The current housing market presents a lucrative opportunity to diversify our Home assortment and strategically align with consumer spending patterns, Ellison said in a statement. By ramping up its Home department, the company hopes to connect with families and become a destination for home products.
Ellison also hopes this move will help weather-proof the company during seasonal periods of the year and increase its revenue per customer.
Partnerships with other companies, such as Empire Today and Ashley Furniture, will be tested to determine whether they warrant inclusion in more stores and markets. By the end of 2017, the company hopes to achieve $1.2 billion in earnings before interest, taxes, depreciation and amortization (EBITDA).
This isn't the company's first foray into the world of home furnishings. At one point in time, the company was credited with covering one-third of the windows in America.