Having been in the industry since April of 1902, we have come a long way to become a renowned chain of mid ranged departmental stores, which have served customers for decades. However, we encountered declining sales in 2013, and had to take the inevitable yet dis-satisfactory action of laying off a considerable section of our workforce.
We had to make a tough decision of laying off around 2,200 employees, in the light of an alarming decline in sales. The employees, who were laid off, were employed at around 100 of our stores as well as district offices. It was an effort on our part to try and contain the costs, to ensure that it would contend with our rapidly declining sales.
We experienced a massive 25% decrease in reported sales within the first year of the implementation of the new promotional and refashioning strategies, made by Ron Johnson, who was the Chief Executive of the company at the time. The scheme had involved positioning Penney stores’ to market unique collections of certain branded boutiques. It involved getting rid of all the coupons and sales events that our departmental store was known and loved for.
We recognized the declining sales and Johnson announced a revision of his policy. But by the time the announcement was made, the retailer had already laid off 19,000 employees.
Regardless of that fact, we concentrated our efforts to lay off employees from the 100 stores which had reported a sales decline. The elimination process had a major impact on the back office job positions. We made sure that none of our staff who dealt with customers were among the ones who suffered a job cut, as we were not ready to compromise on the quality of our customer service.
We incorporated some sales events again in order to win back some of our shoppers who had shied away from us, due to our promotional strategy. We revised our strategy as well, by opening up the boutiques for a new and trendy apparel brand named Joe Fresh.
Johnson took this step to lay off employees in order to improve our sales performance, because retailers had reported a sales decline of around 30% within the fourth quarter of the year, and that is why desperate measures needed to be taken.