J.C. Penney Looks for Home Services to Buttress Fashion

J.C. Penney Co. Inc.’s plan for the future includes a strong emphasis on home services to help out the apparel business.Marvin Ellison, chairman and chief executive officer, said the company would look to “minimize our dependence on apparel” and boost revenues by speeding up its expansion into the home services area, testing replacement and remodeling programs.Ellison no doubt picked up a thing or two about the home business while executive vice president of stores at Home Depot, a post he left to join Penney's in 2014."With the resurgence of the housing market, consumers are spending more than $300 billion annually to upgrade their homes since nearly two-thirds of the nation's homes are over 30 years old," Ellison said. "There is a tremendous opportunity to capture additional revenue…by catering our services to female homeowners who represent over 70 percent of our loyal customer base, and make the primary decisions regarding any home renovations."A spokeswoman for the retailer said: “Apparel will continue to be a mainstay for J.C. Penney. As we think about what we can do to improve the productivity of home, there’s a clear opportunity to improve our percentage of sales within this department.”The existing home department will house displays and fixtures promoting the home services businesses. The spokeswoman said, “We will not need to eliminate or downsize any categories to make room for this initiative.”Penney's has linked with manufacturers and service providers, such as Samsung and Trane, and will test programs focusing on turn-key services for heating and cooling systems, bathroom remodeling, smart home devices and more in select markets to “establish its relevance and appeal among shoppers.”Ron Johnson, one of Ellison’s forebearers at Penney's, was criticized chiefly for failing to test his ambitious plans to remake the retailer, turning off customers with dramatic moves that hurt sales as they were rolled out to the whole chain at once.J.C. Penney returned to profitability last year, but said last month it would have to tighten operations, shuttering up to 140 locations to focus on doors that could give shoppers a more vibrant in-store experience, including in the home area.This is not completely new territory for the retailer.“These are categories that J.C. Penney offered in its assortment many years ago, and we believe the timing is right to reenter home services in order to acquire available market share and differentiate our business from our traditional competitors and pure e-commerce retailers," Ellison said.The push comes just as Penney’s ailing competitor, Sears Holdings Corp., struggles to draw consumers and is spinning off businesses to keep its balance sheet whole.WWD reported last week that the company might be considering an initial public offering of its repair services, rumors a company spokesman declined to comment on at the time.

Business analysis from WWD:

Footfall: How Retailers Want to Get Store Traffic Back