JCPenney stores get a temporary lifeline
By Jackie Wattles
NEW YORK (CNNMoney) -- JCPenney tried to close the doors, but shoppers came pouring in.
The company said Thursday that it's decided to throw a temporary lifeline to 138 stores that it planned to close in April and May. Instead, they'll shut down on July 31, spokesman Joey Thomas said in an emailed statement.
"Since announcing store closures, affected locations have seen better than expected sales and traffic, which is common when store closures are announced," Thomas said. "Traffic typically increases for a variety of reasons, including curiosity, nostalgia and the lure of lower prices."
JCPenney first announced plans to close the stores in February, saying it wanted to shift its focus to its best performing stores. The company -- like most players in the brick-and-mortar retail industry -- hasn't been performing well. Its stock is down nearly 30% in 2017.
Companies that once thrived with storefronts across the country have been beaten down by e-commerce, particularly by digital retail giants like Amazon.
JCPenney specifically named online retail as a big reason why it's now forced to shutter stores.
"We believe closing stores will also allow us to adjust our business to effectively compete against the growing threat of online retailers," CEO Marvin Ellison said in February.
So far this year, Macy's, Staples and GameStop have all announced widespread store closures. The Limited shut down all of its storefronts, and Ralph Lauren said it's closing down its Fifth Avenue flagship store in New York City. Payless ShoeSource filed for bankruptcy this month.
According to the latest jobs report, the retail sector shed nearly 30,000 jobs in March.
JCPenney hasn't said exactly how many people will lose their jobs once the 138 stores are closed in July. But the company has said it plans to offer voluntary early retirement to about 6,000 employees.
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