Those who follow the retail market said the announcement that JCPenney will close more than 100 of its stores nationwide comes as no surprise. In fact, analysts predict other big box retailers will close their stores before the year is over.
It's not clear if Columbus's two remaining JCPenney stores, Polaris Fashion Place and The Mall at Tuttle Crossing, will be among the stores that will close. JCPenney said it will make an announcement in March.
The company blamed "the growing threat of online retailers" as a major reason for its decision.
Gordon Gough of Ohio Council of Retail Merchants doesn't believe big box retailers have lost their purpose.
"Consumers still want to feel and touch certain items is on line shopping going to be bigger and bigger sure but brick and mortar will still have a valuable place," he said.
Here's what JCPenney's closings mean:
- 13-14 percent of all stores will close saving the company $200 million
- It says stores that close are ones that have underachieved or need cash to meet new standards
- The company is asking for voluntary retirements of 6,000 people and will suspend cash contributions to its pension plan
Penney's decision to shutter many of its stores follows the closing by Sears and Kmart that announced closings of 150 stores nationwide and Macy's closed 68 stores. Locally the Limited went out business.
Gough said successful retailers will need to be innovative and conform to consumer needs.
"Our job as retailers is to make sure we meet consumer demand and what consumers want to buy and when they want to buy it," he said.
Penney's closing doesn't mean the end of the brand. The company said it outperformed its store rivals Kohl's, Nordstrom and Macy's.
It generated a Net profit for the first time since 2010 and it saw double-digit growth in jcpenney.com.
Analysts admit online shopping is having an impact on big box retailers, specifically Amazon, which saw it's revenue grow to $100 billion over the past decade.
Penneys wants to be less dependent on clothing and is focusing its efforts on its home area and rolling out major appliances in its stores. It has expanded the Sephora beauty shops and is updating its beauty salons, now branded Salon by InStyle.
It is also beefing up its store label brands like St. John’s Bay. In the fourth quarter, top performing areas included home, Sephora, its salon business and fine jewelry.
The company is aiming to be more competitive in the digital arena. Penney is arming its store associates with mobile devices to help check out online shoppers who are picking up orders in the store.