The Penney Post-Partum Predicament
With the return of Mike Ullman, the birthing process has once again taken hold at JC Penney and retailing from Plano to the Plains and from coast to coast is about to get reborn again.
Certainly the RonJon dividend that stores like Macy's and Bed Bath and TJX cashed in is now null and void as Ullman tries to bring back the not-so-glory days of Penney...which would still represent an improvement over the past year's debacle brought on by the Johnson Administration.
So what does it all mean for the stores that compete against Penney? Let's take a look, shall we:
Macy's: Even though the former Feds at the company won't come right out and say it, Macy's has been the biggest beneficiary of the JCP era. It has kept its foot to the promotional pedal non-stop while continuing to expand its private label and exclusive offerings. Macy's would by definition be the most vulnerable store to Ullman II, the question being whether it be will able to retain the new shopping dollars it gained over the past 18 months. I say yes...at least for the short-term.
Kohl's: Here's the store that should have had the most to gain from RonJon-ism but didn't. It has kept the coupons coming and will probably need to sharpen its scissors even more so as Penney gets back in the clip business. If only that was the sole problem emanating from Menomonee Falls.
TJX: Hard to quantify but a big chunk of the run-up in sales at TJ Maxx, Marshalls and especially Home Goods has had to come directly out of the Penney pot and that's not likely to change. Home Goods is poised to become a huge player in the home business and the three horsemen of the Apocalypse - Jonathan Adler, Terrence Conran and Michael Graves - along with their faithful companion Martha are in no position to stop that from continuing.
Bed Bath & Beyond: A little more difficult to figure out how much it has benefited from the Plano problems, but certainly it has picked up market share. With coupon clipping more and more the driving force of BBB sales, one has to wonder how the return of the old Penney will impact sales here.
Target: You have to think that it was the Target customer that was Johnson's sweet spot for the new JCP, but one has to also think it wasn't happening. The Target customer never left the store to go across the highway to JCP...but she's clearly been going someplace else, that's for sure. Target needs to continue to work to bring her back.
Sears: Lots of pain, not much gain. No change.
Right now there's a giant pregnant pause in the Penney picture. Let's see what happens...in nine months.