Retail giant J.C. Penney has had a hard time trying to transform its business under the helm of new CEO Ron Johnson who came over from Apple. The retailer announced on Tuesday that it was eliminating another 350 jobs at its Plano, Texas headquarters.
Last winter after Johnson announced a new pricing strategy for Penney’s, its shares increased and peaked at $43.13 in early February. However, since that peak the value of the stock has been halved.
On Tuesday, the shares took another hit as investors became worried that the current slump in sales is beginning to deepen amongst the continued confusion that customers have over the pricing strategy that has eliminated sales events at different times of the year in and has only everyday prices. Also making things worse for the chain is the economic environment globally is continuing to deteriorate.
The announcements of cuts on Tuesday follow the company’s move earlier in the spring to cut 600 jobs in Plano. Penny’s has tried to cut costs while amidst an attempt at turning around the company, which is a very difficult task to accomplish. The entire operation is being overhauled from adding new brands to implementing the new pricing strategy, which eliminated the year round sales events and succeeded in turning many clients off.
During the first quarter of 2012, the company announced a loss that was bigger than previously expected, which included nearly a 20% decline in overall revenue. Last month, a former Target executive, Michael Francis, who had been earmarked to head up the company marketing of the new overhaul project, abruptly resigned and immediately left the company.