Retail giant JCPenney witnessed a historic downfall on Friday as it applied for bankruptcy during the worsening coronavirus financial crisis.
The 118-year-old fierce and rebellious company received a huge financial blow during the pandemic. As it is, JCPenney has been struggling for several years to gain back its top position, despite decades of poor decision making and unstable market trends.
While the company had previously termed its situation as being under control with the recent unveiling of its turnaround plan, the worsening Coronavirus pandemic proved too much to handle.
JCPenney’s CEO, Jill Soltau stated that the company had made great progress towards rebuilding under its renewal strategy, just until the pandemic struck.
JCPenney becomes the 4th biggest retailer in the U.S., to have filed for bankruptcy during this month. Another clothing retailer giant, J.Crew had similarly applied for bankruptcy on the 4th of May. This was closely followed by Neiman Marcus on the 7th and Stage Stores on the 10th of May.
JCPenney began its dominant entry into the retail industry back in 1902, opening its first store in Wyoming.
The brand soon grew exponentially, becoming a leading national retailer and backbone to some of the country’s top shopping malls in the suburban areas.By 1973, JCPenney started operations at over 2000 locations in the country.
Today, it comprises over 85,000 employees, making it one of the largest US-based retailers to have filed for bankruptcy. The brand has more stores than any other company to have applied for bankruptcy, including Sears, Sports Authority, and Toys “R” Us.
JCPenney has witnessed a leading number of struggles in the recent decade, consisting of piles of debt as well as red ink. It’s almost as if one mistake led to another, including a change of 4 alternative CEO leaderships.
Unfortunately, the radical changes proved unsuccessful at reviving the brand and were termed as spectacular failures, soon to become undone. Despite this history, there were signs of hope and sustainability in growth right before the pandemic.
But this optimism was destined to be short-lived. The period of bankruptcy will allow the brand to shed off its liabilities and debt while closing unprofitable operations indefinitely.