Northern, WI 03/08/2013 (usmarketsdaily) - Former CEO of J.C. Penney Company, Inc (NYSE:JCP) Allen Questrom says that Chief Executive Officer, Ron Johnson’s revival plan for the company will not work and waiting it out will only worsen the matter. Questrom is not alone in his criticism of Johnson. J.C Penney’s annual revenue slipped to $13 billion by 25 percent which has been the company’s lowest since 1987 and the first year as CEO of J.C. Penney Company has not been the best for Johnson. Marketing missteps have alienated customers even as the company tried to move away from coupons and sales and largely switch from the store model to collections of boutiques.
Matter of bad timing
Questrom said that there is no way a company can expect to turn a middle-market store in the midst of a recession and have no sales to show for it. It’s not something that has worked before and this strategy will work if applied over a period of time. Apart from this, in times of economic crisis customers are looking for more value and steps such as these do not stand a chance. Ex- Apple Inc (NASDAQ:AAPL) retail chief, Johnson has been reviving promotions and introducing new brands such as Joe Fresh the Canadian retailer in efforts to bring J.C. Penney Company, Inc (NYSE:JCP) back on track.
Big investor bows out
Early this week, Vornado Realty Trust (NYSE:VNO), who at one time was J.C Penney’s largest investor sold 10 million if the company’s shares. Steven Roth, the Vornado chairman who is also on the J.C Penney board took a loss hit of over $200 million on his investment. Questrom who was CEO of Penney Company, Inc (NYSE:JCP) from 2000-2004 said that putting the company up for sale will not be a lucrative proposition. J.C Penney is not in the best of health and the price that they will be offered will be too low.
Shares of J.C. Penney Company, Inc (NYSE:JCP) went up by 2.70% to close at $14.82
Shares of Apple Inc (NASDAQ:AAPL) went up by 1.16% to close at $430.58
Shares of Vornado Realty Trust (NYSE:VNO) went down by 0.24% to close at $83.02