J.C. Penney: Should Investors have patience with ceo ron johnson
This article written by Steven Mallas for The Motley Fool agrees that there is a need to end the "sales culture" that dominates the retail industry. However, the introduction of J.C. Penney's new system could not have effected its stock price any worse. Mallas argues that we should not blame Johnson and force him to resign for his failed plan. It is not entirely his fault that consumers reacted poorly to the price change. J.C. Penney's change brings to light the idea that retailers should end the "price-war game" of competing for the lowest discounted prices while trying to maintain a profit. Mallas suggests that "sane, stable" price systems may appeal more to a new generation of consumers. Mallas goes as far to condone Johnson's motivation to change J.C.Penney for the better and that stock prices will always respond poorly at first to a drastic change but should not greatly influence an executive decision. According to Mallas, Johnson will need to produce more advertisements and better the store's customer service along with the price changes. Mallas suggests that although J.C. Penney's does not appear a safe investment at the moment, if its innovations take hold in the retail industry stock holders could eventually pay off.
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J.C. Penney reports a loss; says revamping is on track
This article from The New York Times submitted by Bloomberg News promotes the idea that J.C. Penney will rebound in the near future. The following statistics show a different story. Before Mr. Johnson's interview for this article the shares nearly twelve percent after a financial report was posted. This report showed a quarterly loss and predicted financial failings in the future. Ron Johnson counters these statistics by stating "We said this would be a really tough year. Somehow, I don't think that message got through." This suggests that J.C. Penney's financial decline may only be a trivial defect to some greater scheme. Johnson remains hopeful that his new changes to J.C. Penney's system will begin a new age of retail experience. For the meantime, in-store and online sales went down over twenty percent each in the last quarter.
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