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Ben Hillyer / The Natchez Democrat — Skylar Morgan walks out of the Natchez J.C. Penney store Wednesday evening after making a purchase. The store and its sign will disappear from the local landscape after 60 years of serving Natchez customers.
Ben Hillyer / The Natchez Democrat — Skylar Morgan walks out of the Natchez J.C. Penney store Wednesday evening after making a purchase. The store and its sign will disappear from the local landscape after 60 years of serving Natchez customers.

J.C. Penney to close Natchez store, impact 55 jobs locally

Published 12:01am Thursday, January 16, 2014

NATCHEZ — The Natchez Mall J.C. Penney store was one of 30 impacted by the company’s announced closures Wednesday.

In Natchez, 55 jobs will be impacted.

Natchez J.C. Penney Manager Shirley Williams said she received word of the closure Wednesday and had informed the store’s employees by the time the national announcement was made at 3:30 p.m.

“This decision was not a reflection on the store, or the associates or the Natchez community,” Williams said. “This was just a business decision as the company considers its strategy going forward.”

J.C. Penney opened in 1954 on Main Street in what is now Kimbrell’s, and relocated to the Natchez Mall in the early 1980s.

Mall manager Marie Lofton said she had not been informed of the planned closure Wednesday and declined to comment until she knew more.

The Natchez J.C. Penney was rated No. 3 in its district of 24 stores for customer service, Williams said, and the Natchez location will be open until May 3.

“Business here will continue until then, and we will continue to provide the same great customer service,” she said.

Some employees will be given an opportunity to transfer to another J.C. Penney location, Williams said. The company will also offer a two-day career transitioning course in which employees will receive training in resume writing and job-searching skills.

Natchez Inc. Executive Director Chandler Russ and Natchez Mayor Butch Brown said they would be pleading the case for the Natchez location with J.C. Penney officials.

Brown said he got word of the closure from J.C.Penney at approximately 2 p.m. Wednesday. He said the closure is unfortunate but believes the city and economic development officials can put a plan in place to help find work for those who will lose their jobs when the store closes in May.

“This is not the end of the world,” he said. “We will make lemonade out of lemons.”

Russ said the store employees are the first priority in the response.

“It is obviously not good news, and we will hopefully have a chance to visit with the officials of J.C. Penney and plead our case, and we will also work with the mall management in order to help facilitate other tenants into that space,” he said.

“We are still confident in the market in the area, and I don’t think (the closure) is indicative of the area as much as it is of J.C. Penney as a whole.”

Brown said economic development opportunities, including the development of Tuscaloosa Marine Shale drilling could bring hundreds or thousands of jobs to the area.

“That will do nothing but enhance (J.C. Penney’s) market,” he said. “I told them that we understand it is a business decision, but we just want the opportunity to chat with management on a corporate level.”

After the Natchez store closes, customers will still be able to shop online and have their packages delivered to the stores in Alexandria, Baton Rouge, McComb and Monroe, Williams said.

But long-time customer Yolanda Morgan said she was going to miss the Natchez location.

“We love the doorbusters sales, and we are here every Black Friday,” she said. “J.C. Penney is always our first stop. It is one of my favorite shopping places.”

The 55 jobs cut in Natchez are only a portion of 2,000 jobs the company will eliminate nationwide.

The news raises concerns that Penney’s holiday season sales were not what the company hoped for and that the chain needs to do even more to recover from a turnaround plan that has had disastrous results.

J.C. Penney Co., based in Plano, Texas, said earlier this month it was pleased with its holiday results but declined to give sales figures, raising worries among Wall Street analysts about how the season actually fared.

“It was a season where they realized that they had to do more to reconnect with the customers they’ve lost,” said Brian Sozzi, CEO and chief equities strategist at Belus Capital Advisors.

The cuts announced Wednesday should save more than $65 million annually. The company will take $26 million in pretax charges in the third quarter and $17 million in future quarters. Penney has 116,000 staffers and operates more than 1,100 stores. All the job cuts are related to the store closings.

Penney is expected to be among a number of stores that will be announcing it will be cutting staff and closing stores in the next few weeks. After the holiday season, stores typically re-evaluate their store fleet and announce job cuts and store closings. But analysts believe that after a tough holiday season where stores had to discount early and often to get shoppers to buy in a tough economy, the cuts will be deeper than normal, says John Challenger, CEO of Challenger, Gray & Christmas, a global outplacement firm. Stores are also contending with a shift in consumer spending to PCs and mobile devices.

Macy’s Inc., a standout among its peers, announced last week that it was cutting 2,500 jobs as part of a reorganization to sustain its profitability.

“Retailers are having to come to terms with these consequences,” Challenger said.

The holiday season is crucial since it can account for anywhere from 20 to 40 percent of a retailer’s annual sales. But at J.C. Penney, the stakes are higher.

Penney is trying to recover from massive losses and plummeting sales drops that occurred under former CEO Ron Johnson, who was ousted in April after being on the job for 17 months. The company then brought back former CEO Mike Ullman.

Penney has since reinstated the frequent sales events that Johnson ditched. It’s also restored basic merchandise, particularly store brands like St. John’s Bay, which were either phased out or eliminated in a bid to attract younger, more affluent shoppers.

 

Lindsey Shelton and the Associated Press contributed to this report.

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