JCPenney may add bedding to as many as 500 more stores
By Carole Sloan -- Furniture Today, October 28, 2001
PLANO, Texas — JCPenney is looking at selling bedding in as many as 500 more stores.
Charles Chinni, senior vice president, home and fine jewelry, said that management is looking at adding bedding to stores that currently don't sell any furniture, but are in markets where other JCPenney stores have furniture departments or there are JCPenney freestanding home stores.
This strategy would leverage advertising the chain already does for bedding in those markets.
The category also would serve as a traffic builder, part of Penney's drive to increase the productivity and profitability of its department store business.
Chinni, who joined Penney earlier this year, said management will decide on the proposal by year-end.
He added that already, the company has been restructuring its furniture departments to emphasize "the more profitable categories — upholstery, recliners, bedding. We'll have less reliance on bedroom and dining room case goods. It's already paying off."
As part of the new game plan, Penney has hired Joe DiSarro from Burdines as buyer of non-traditional upholstery, bedroom and dining room.
Earlier, Penney had streamlined its supplier base in furniture. Ten suppliers now provide 80% of the products, led by Furniture Brands International, parent of Lane, Broyhill and Thomasville.
Penney now carries furniture in 176 stores, including 36 freestanding home stores, and five stores with bedding departments only. The proposed bedding departments, in as many as 500 more of the chain's nearly 1,100 stores, could run between 1,000 and 2,000 square feet.
"(They) would be closely tied to markets that already are advertising bedding," Chinni said. Manufacturers would make deliveries via home delivery agents, bypassing JCPenney warehouses.
In the past year, Penney has made significant changes in management, corporate direction and merchandising in an effort to shore up its flagging business. Sales in September were up 8.7% from a year earlier, Chinni said, and furniture had plus comps for both August and September.
In 2000, Penney was the top department store in furniture with sales of $725 million.
"Our big issue in furniture is how to handle the logistics. The back house challenge will take about 18 months to resolve completely. But we've already developed an improved delivery and return program," Chinni said.
One step has been to streamline handling. Previously, the company might have handled a piece of furniture as many as 11 times, but now many products will go from manufacturers to the company's home delivery agent, bypassing Penney warehouses.
Packaging is another Penney focal point. "We are working with suppliers for Penney quality control both at the manufacturer and our warehouse points," he said.
As for returns, Chinni said, "We instituted a seven-day return program in July — it was unlimited before — and we've had no problems."
These operational shifts are the first results of the task force the company organized last spring to focus on all elements of the Penney furniture business — stores, merchandising, vendors, warehousing, delivery — in an effort to become profitable.
The company also is making "significant changes" to its catalog, an important part of its furniture business, with a more fashion-forward look. The first big changes will be seen this coming spring, Chinni said.
| Chinni |
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