NEW YORK — J.C. Penney Co. is planning major cutbacks at its catalog operation, with the loss of 2,000 jobs.
Penney’s catalog operation is the nation’s largest at about $3 billion in sales. The job cuts are primarily coming from closing a catalog fulfillment center in Atlanta and two telemarketing centers in Atlanta and Lenexa, Kan.
The streamlining will result in pretax charges of approximately $40 million, or $0.10 per share, in 2003, or about $20 million in each of the first two quarters.
On the other hand, the company expects these actions to generate annual savings of about $30 million, or $0.07 per share, which will be fully realized in 2004.
While Penney’s stores and Internet business have been top industry performers, the catalog has been hampered by high costs and returns, though Penney’s said the catalog continues to make a small profit. The firm has already eliminated several specialty books and certain poor-selling merchandise, and has narrowed the mailing list, accounting for a major portion of the 20 percent catalog sales dropduring the holiday season.
On the positive side, last year the division reorganized top catalog management and hired several new merchants, including Bernie Feiwus, senior vice president and associate director of catalog-Internet, who once ran Neiman Marcus Direct, and former Spiegel ceo John Irvin, a Penney Co. executive vice president and president of catalog-Internet. The team has taken steps to make the merchandise more fashionable and to improve photography and layouts, and has been testing products, including distributing a spring preview catalog to help strengthen offerings in the big book. Penney’s has also been getting involved in mailing list exchanges.
The catalog facilities involved in the latest round of cuts will close by the end of the second quarter of 2003. By that time, the company will have eliminated two catalog fulfillment centers and reallocated approximately 1.1 million square feet of fulfillment center space to the new department store support center network since January 2000. In addition, 17 outlet stores, four telemarketing centers and a fulfillment center in Milwaukee previously closed.
"Our goal is to have a substantial and profitable catalog and Internet business, with an appropriately sized infrastructure that will support current and future business needs," Allen Questrom, chairman and chief executive officer, said in a statement. "In the last two years, catalog has made significant strides in improving its profit contribution by eliminating unprofitable sales, improving inventory management and reducing expenses."
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)
@heriethpaul and @gracebol have a moment on the @victoriassecret fashion show 2017. See every look from the runway on WWD.com. Link in bio. (📷: @giovanni_giannoni_photo) #wwdfashion #victoriassecret #VSFashionShow
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia