J.C. Penney banks on rebound through large appliance sales
NEW YORK — J.C. Penney says it will sell major appliances online and expand its rollout of the category to nearly 500 stores, or almost half of its stores, this summer.
The move comes after a successful test of offering major appliances such as washing machines and refrigerators in 22 markets in February. Penney left the major appliance business more than 30 years ago.
Penney also said Monday it exceeded its own goal for one measure of profit. Shares edged up in midday trading Monday.
Penney, based in Plano, Texas, is looking to rebuild, particularly in the home area, after a catastrophic reinvention plan under former CEO Ron Johnson resulted in sales and profits in free fall in 2012 and 2013. Business has since stabilized but revenue has not returned to pre-Johnson era levels.
The home appliance business represents a big opportunity for Penney. It’s a hot area in retailing and benefits from a strong housing market.
The move also comes as department stores look to reinvent themselves to counter growing competition from online leader Amazon.com and from off-price stores such as T.J. Maxx.
“The pilot confirmed that we should not limit our business to apparel and soft home in order to achieve significant revenue growth,” CEO Marvin R. Ellison said in a statement.
Penney said that it exceeded its earnings before interest, taxes, depreciation and amortization for the first quarter. It also reiterated its full-year guidance for that measure of $1 billion. It expects to report first-quarter results Friday.
