J.C. Penney to close Lakeland Distribution Center and 13 to 14 percent of stores

FILE - In this Feb. 19, 2015, file photo, shoppers visit a J.C. Penney store in New York. The Texas-based retailer reports quarterly financial results, Friday, Nov. 13, 2015. (AP Photo/Mark Lennihan, File)

NEW YORK (AP) – J.C. Penney said it will be closing anywhere from 130 to 140 stores as well as two distribution centers, including one in Polk County, over the next several months as it aims to improve profitability in the era of online shopping.

The closures, announced Friday, represent about 13 percent to 14 percent of the company’s current store count, and less than 5 percent of total annual sales.

“I’m surprised, I hadn’t heard that. Not good. Not good to have them closing,” shopper Evelyn Nagy said. “My kids grew up when they were little, whatever we needed, the basic clothes, whatever, we went to Penney’s.”

J.C. Penney said the distribution center in Lakeland, will close in early June, at which time operations will transfer to J.C. Penney’s logistics facility in Atlanta as part of an effort to streamline store support services. J. C. Penney also is in the process of selling its supply chain facility in Buena Park, Calif. in an effort to monetize a lucrative real estate asset.

Distribution center in Lakeland, FL.

Associates who will be impacted by the store and distribution center closures will receive separation benefits, which includes assistance identifying other employment opportunities and outplacement services such as resume writing and interview preparation.

“I didn’t really see it coming, but they gave us plenty of time to react and find other jobs,” distribution center employee Ashton Seas said, but admits, he hasn’t found anything yet. “They’re helping us out with resumes and things of that sorts. I may go to school, or find another job, one of the two, or both, maybe.”

Seas said for some for of the more seasoned employees, it’s tough. “Because they have been here for like 10 to 15 years,” he said.

The retailer also announced it plans to implement an early retirement program for some employees.

“We understand that closing stores will impact the lives of many hard working associates, which is why we have decided to initiate a voluntary early retirement program for approximately 6,000 eligible associates. By coordinating the timing of these two events, we can expect to see a net increase in hiring as the number of full-time associates expected to take advantage of the early retirement incentive will far exceed the number of full-time positions affected by the store closures,” said Marvin R. Ellison, chairman and chief executive officer of JCPenney, in a news release.

Eligibility for the Voluntary Early Retirement Program (VERP) will generally include home office, stores and supply chain personnel who met certain criteria related to age and years of service as of Jan. 31. Approximately 6,000 associates are eligible for the program.


Distribution center in Lakeland, FL.

The news came as J.C. Penney posted a profit in the fourth-quarter compared to a loss a year ago. The company posted quarterly sales of $3.96 billion, down 0.9 percent from $3.99 billion a year ago. Revenue at stores opened at least a year was down 0.7 percent.

J.C. Penney is joining other department stores like Macy’s who are shrinking its footprint amid challenges in the industry.

J.C. Penney plans to release a full list of planned closures in mid-March pending notification of all affected personnel. Nearly all impacted stores are expected to close in the second quarter of 2017.

“I know my husband uses Amazon a lot, but I don’t. I like to come and try on things because I don’t like sending things back,” said one shopper.

Read the full release here.





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