In its recent annual filing, J.C. Penney
New CEO Ron Johnson's arrival has marked the start of a transformation at the retailer. One major change the former Apple
Under its new strategy, Penney will resort to an everyday-low-pricing concept coupled with monthly promotional offers at its counters. But in January, when the new plan was made public, some analysts feared that it might baffle shoppers and alienate long-term Penney consumers who'd become accustomed to looking for daily discounts.
Show me the money
Johnson's efforts to re-create the company have already been rewarded: He received $53.2 million in compensation for 2011, and that was on top his base salary of $375,000. He also got a performance-based cash bonus of $236,000, calculated on a pro-rated basis. That's not all: He also got $13,275 to cover perks, such as his own use of the company's aircraft. Not bad.
Since taking over in November from former CEO Myron "Mike" Ullman, Johnson has brought a number of top Apple employees to the company. Michael Kramer joined as chief operating officer, Kristen Blum as chief technology officer, and Daniel Walker as chief talent officer. In addition, Laurie Beja Miller is set to take over as president of The Square, a town-square concept being implemented in J.C. Penney stores. Johnson hopes to mimic the unique Apple shopping experience at Penney's stores, but the concern over losing loyal customers remains.
While spending rises, Penney declines
Consumer spending in general has improved -- Wal-Mart
Meanwhile, Penney said its same-store sales rose only 0.2%, significantly down from the 2.5% rise last year. Analysts at Citi expect Penney's sale to tumble by $1.2 billion this year. Are shoppers having trouble adjusting to the new pricing program? I was impressed with Penney's initiatives at first, but I'm growing wary of this stock, at least in the short term. What do you think?
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