J.C. Penney's rebuilding strategy? Sell secondhand clothing
By Megan Cerullo
/ MoneyWatch
J.C. Penney and ThredUp Inc. will sell used clothing in 30 stores through a partnership with the popular resale site that stocks brands from Gap to Gucci.
The announcement came as J.C. Penney reported a net loss of $48 million for the second quarter and a nearly 9.2% drop in sales from the year-earlier period.
The clothing initiative might not be enough to save 117-year-old J.C. Penney, a literal penny stock these days that's trading for less than 60 cents a share.
Trending News
Ailing department store chain J.C. Penney is making its first foray into the increasingly popular used-clothing business.
The retailer on Thursday announced a partnership with online consignment store ThredUp Inc. as part of its effort to rebuild the waning brand into a profitable business.
The announcement came as the retailer reported a net loss of $48 million for the second quarter, and a nearly 9.2% decrease in sales compared to the same quarter a year ago.
Analysts sounded the alarm bells and warned that 117-year-old J.C. Penney must act fast to save itself.
"When you have sales declines of almost 10% over the course of the year, you've got a very serious problem that needs to be very quickly addressed. It's a shrinking company with a lot of costs and debt and they need to move very rapidly," said Neil Saunders, managing director of GlobalData Retail.
The reasons for J.C. Penny's decline are clear, Saunders said. "It does not take much effort to understand why customers are migrating away: Most stores lack energy, interest and ease. They are not pleasant places to shop and offer little that is compelling, so customers increasingly avoid them," he explained.
He said the retailer's partnership with ThredUp is a step — albeit a small one — in the right direction.
"This kind of partnership should only be seen as the icing on the cake. It's a nice extra benefit; it's not a solution or replacement for getting the core business right," Saunders said.
Thirty of its stores will begin selling used clothing through a partnership with the resale site, which stocks brands from Gap to Gucci. The selection will rotate weekly in order to surprise frequent shoppers, according to a press release.
"With the rise of online resale markets, there's no doubt that demand for great value on quality brands is at an all-time high. There's an emotional thrill that comes with finding one-of-a-kind secondhand product for much less," said Michelle Wlazlo, executive vice president and chief merchant for JCPenney.
The so-called circular fashion movement is gaining steam as more shoppers eschew buying new clothing, citing the toll of clothing production on the environment as well as their own household budgets.
In 2016, the apparel and footwear industries together accounted for more than 8% of global climate impacts — the equivalent of 3,990 million metric tons of carbon dioxide, according to a report from Quantis.
The resale market is expected to outpace fast fashion within 10 years, according to a 2019 report by the Business of Fashion. The secondhand market is projected to be valued at $64 billion by 2028, according to ThredUp's research.
Indeed, 64% of women have bought or are now willing to buy secondhand products, according to ThredUp.
}
This isn't ThredUp's first foray into brick-and-mortar retail. J.C. Penney rival Macy's on Wednesday announced a similar partnership with the company.
ThredUp sells name-brand clothing sells for up to 90% off retail prices and has resold nearly 100 million pre-owned garments.
From its perspective, the partnership will bolster ThredUp's visibility.
"This is wonderful, giving it exposure in existing stores that will enlarge its audience and amplify the brand for them," Saunders said.
Still, the initiative might not be enough to save J.C. Penney, a literal penny stock these days that was trading this week for less than 60 cents a share.
"It's a sensible move, but in some ways there is this element of department stores scraping around to find things to put in their big shops because they aren't delivering sales," Saunders said. "There is also an element of having to borrow someone else's smart thinking because you are not savvy enough to think of it yourself."
First published on August 15, 2019 / 2:48 PM
© 2019 CBS Interactive Inc.. All Rights Reserved.
Report finds sexual violence at Levi's, Wrangler factories
The Worker Rights Consortium details sexual harassment and abuse at textile factories in Africa making popular brand-name clothing
10M ago 
July was the hottest month ever recorded on Earth
On the last day of the month alone, 11 billion tons of ice melted across Greenland â contributing to record low sea ice levels
35M ago 
Court says detained migrant children must get soap
Federal judges dismissed the government's argument that providing "safe and sanitary" conditions for detained children doesn't require soap or toothpaste
46M ago 
U.S. lawmaker joins international Facebook investigation
Rep. David Cicilline joins the International Grand Committee on Disinformation and "Fake News," as lawmakers from a dozen countries seek answers on election influencing
1H ago 
Hong Kong protests: How did we get here?
CBS News Asia correspondent Ramy Inocencio explains what brought the pro-democracy protesters onto the streets, and what could come next
4H ago 
Guilty verdict in "Hollywood Ripper" trial in Los Angeles
Prosecutors charged Michael Gargiulo with murdering three women â including 22-year-old Ashley Ellerin, a friend of Hollywood actor Ashton Kutcher
3M ago 
J.C. Penney's rebound strategy: Sell used clothing
Old-school retailer announces in-store partnership with popular online consignment website ThredUp. Will it work?
12M ago
July was the hottest month ever recorded on Earth
On the last day of the month alone, 11 billion tons of ice melted across Greenland â contributing to record low sea ice levels
35M ago
Court says detained migrant children must get soap
Federal judges dismissed the government's argument that providing "safe and sanitary" conditions for detained children doesn't require soap or toothpaste
46M ago 
House Judiciary subpoenas Lewandowski hours before Trump rally
The House Judiciary Committee has issued subpoenas for former Trump aides Corey Lewandowski and Rick Dearborn
1H ago
Court says detained migrant children must get soap
Federal judges dismissed the government's argument that providing "safe and sanitary" conditions for detained children doesn't require soap or toothpaste
46M ago
House Judiciary subpoenas Lewandowski hours before Trump rally
The House Judiciary Committee has issued subpoenas for former Trump aides Corey Lewandowski and Rick Dearborn
1H ago 
John Hickenlooper drops out of presidential race
Multiple people familiar with his plans have said in recent days that Hickenlooper will spend time mulling a possible bid for the U.S. Senate
1H ago 
O'Rourke returns to campaign trail, promises to take fight to Trump
Beto O'Rourke has been absent from the campaign trail in the wake of the deadly shooting in El Paso, Texas
updated 26M ago 
CBS News Eye on Trends: The latest from the CBS News Election & Survey Unit
A recap of latest polls and data-driven studies from the CBS News Election & Survey Unit
2H ago 
MLB player becomes American citizen years after escaping Cuba
Because of America's relationship with Cuba, Puig had to be smuggled into the country through Mexico
22H ago 
Woodstock at 50, in the words, and music, of those who were there
A half-century after a mass of humanity converged on a farm in Bethel, N.Y. for three days of peace and music, musicians and concert-goers recall a unique moment for their generation
Aug 4 
Reality TV stars plead not guilty to tax evasion charges
Todd Chrisley posted on Instagram on Monday a denial of any wrongdoing and alleged a former employee was "stealing from us big time"
22H ago 
Taylor Swift sends fan $6,000 for tuition
Taylor Swift just surprised a fan from Canada by sending her more than $6,000 for tuition and rent after reading about her family struggles in a Tumblr post.
Aug 14 01:06 
Jada Pinkett Smith speaks to 20-year-old self
Actress Jada Pinkett Smith is the creator of âRed Table Talk,â a show that streams on Facebook Watch. On âRed Table Talk,â Pinkett Smith, her daughter Willow, and her mother Adrienne Banfield-Norris have raw conversations on provocative issues from marriage to mental health. Sheâll also soon return to the big screen in the action movie âAngel has Fallen,â alongside Gerard Butler. Pinkett Smith joined âCBS This Morningâ Wednesday to discuss those projects and more.
Aug 14 06:55 
Overstock shares sink after CEO comments about "Deep State"
Investors are fleeing retailer Overstock after its CEO issued a bizarre statement about the "deep state" and "men in black"
1H ago
U.S. lawmaker joins international Facebook investigation
Rep. David Cicilline joins the International Grand Committee on Disinformation and "Fake News," as lawmakers from a dozen countries seek answers on election influencing
1H ago 
WeWork filed its IPO â now meet its We Double
A Wyoming company with a Chinese address and $441 in the bank seems poised to benefit from WeWork's buzzy IPO
20H ago 
Dream Chaser spaceplanes to launch on Vulcan rocket
Sierra Nevada Corp. picks ULA's Vulcan rocket to boost Dream Chaser spaceplanes into orbit
20H ago 
Facebook contractors listened to Messenger chats
Facebook said it's ended the practice of having contractors listen to and transcribe the recordings
Aug 14
July was the hottest month ever recorded on Earth
On the last day of the month alone, 11 billion tons of ice melted across Greenland â contributing to record low sea ice levels
35M ago 
Nature up close: Theodore Roosevelt, the conservation president
The conservation movement in the U.S. dramatically advanced under the 26th president's watch, as he established 5 national parks, created the National Wildlife Refuge System and U.S. Forest Service, and oversaw the protection of 230,000,000 acres
1H ago 
12-year-old discovers apparent woolly mammoth tooth in Ohio
Jackson Hepner was taking photos with his family when he spotted the giant tooth along the edge of a creek
15H ago 
This university is banning beef to fight climate change
"Declaring a climate emergency cannot be empty words," the school's warden said
20H ago 
The fight to save the northern white rhino
The last remaining members of the species are a mother and daughter that live under 24-hour armed guard in Kenya â but two rhinos thousands of miles away could offer hope
Aug 14 
Crying on the job? 8 in 10 workers say they've sobbed at work
Workplace weeping is a common experience, with almost half of workers blaming their boss or colleagues
6H ago 
Flight attendant diagnosed with measles after N.Y. flight has died
El Al flight attendant Rotem Amitai was diagnosed with measles after flying from New York to Israel
15H ago 
Brother scientists no longer at Novartis after drug scandal
Brian Kaspar and Allan Kaspar have left the drugmaker after the FDA said the company could face criminal penalties
21H ago 
Tips for lowering blood pressure, which may cut dementia risk
A study in the Journal of the American Medical Association has found a link between high blood pressure and dementia
Aug 14 
New warnings of link between lung disease in teens and e-cigarettes
Minnesota became the third state where serious injuries linked to e-cigarettes were reported in the last month
Aug 14 
U.S. kids are quitting sports amid rising costs, inequality
Youth sports participation is rising among richer families, as children lower down the ladder exit the field
2H ago 
Walmart CEO: Time to debate an assault weapons ban
America's largest retailer estimates it represents about 2% of the U.S. firearms market and about 20% of ammo sales
1H ago
Crying on the job? 8 in 10 workers say they've sobbed at work
Workplace weeping is a common experience, with almost half of workers blaming their boss or colleagues
6H ago 
Stocks whipsaw amid recession fears, China's threat
Investors brace themselves after Wednesday's 800-point plunge amid recession signals and China's threats on trade war
4H ago
Report finds sexual violence at Levi's, Wrangler factories
The Worker Rights Consortium details sexual harassment and abuse at textile factories in Africa making popular brand-name clothing
10M ago
Guilty verdict in "Hollywood Ripper" trial in Los Angeles
Prosecutors charged Michael Gargiulo with murdering three women â including 22-year-old Ashley Ellerin, a friend of Hollywood actor Ashton Kutcher
3M ago 
America's deadliest mass shootings
These are the deadliest mass shootings in American history
Aug 5 40 photos 
Police give update on Philadelphia shooting standoff
Maurice Hill, 36, is expected to face multiple charges, including attempted murder and aggravated assault
updated 44M ago
Walmart CEO: Time to debate an assault weapons ban
America's largest retailer estimates it represents about 2% of the U.S. firearms market and about 20% of ammo sales
1H ago 
Child porn fugitive found hiding in underground bunker
Jeremiah Button's jury trial was just two weeks away when he disappeared in early 2016
5H ago
Dream Chaser spaceplanes to launch on Vulcan rocket
Sierra Nevada Corp. picks ULA's Vulcan rocket to boost Dream Chaser spaceplanes into orbit
20H ago 
Our galaxy's black hole suddenly flashed a bright light
Scientists called the flashes "unprecedented"
Aug 14 
How to watch the Perseid meteor shower peak Monday night
Anyone trying to watch the Perseid meteor shower should try to stay away from bright city lights
Aug 12 
A meteor large enough to see from Earth just hit Jupiter
The rare moment was captured with nothing more than a backyard telescope in Texas
Aug 9 
Saturn's rings are disappearing
NASA's Cassini spacecraft ended its historic exploration of Saturn in 2017 and, slowly but surely, scientists are learning more about the ringed planet. Data from the 13-year mission helped scientists determine Saturn's rings are much newer than the planet itself — and they're disappearing.
Aug 6 00:42 
The worst movies of 2019
The worst films of the year star big name actors, including Keanu Reeves, Anne Hathaway, and Chris Hemsworth.
Aug 9 51 photos 
The Oddities & Curiosities Expo
A traveling exhibition of gothic and occult art, sideshow performers, and bizarre specimens stopped outside Chicago, where CBS News photographer Jake Barlow took in the odd sights
Jul 22 24 photos 
New York's Central Park
America's first major landscaped public park, the 840-acre park in Manhattan welcomes more than 37 million visitors every year
Jul 21 25 photos 
Manson Family murders: The terrifying story in pictures
A look at the cult slayings that shocked â and scared â America
Jul 3 44 photos 
New on Netflix, Hulu and Amazon
Shows and movies you'll want to stream soon
Jun 24 30 photos 
Popular
Calligrapher embraces tech to grow business
In our Small Business Spotlight â Joanna Krupnick used Instagram to promote her old-fashioned designs and launch a new business.
Aug 14 03:17 
Previewing "David Makes Man"
A new TV series called "David Makes Man" is about a 14-year-old prodigy handling the pressures of an elite education and the dangers of his Miami neighborhood. Creator and Executive Producer Tarell Alvin McCraney and actor Akili McDowell joined Gayle King in the Toyota Green Room to discuss the new show airing on the Oprah Winfrey Network.
updated 6M ago 13:49 
Truck nearly hits group of protesters
Harrowing video shows a pickup truck drive toward a group of protesters sitting on the ground outside of an Immigration and Customs Enforcement detention facility in Rhode Island.
updated 50M ago 00:38 
A climate reckoning in the heartland
A historic flood in March 2019 left much of America's heartland under water. Grain farmers already struggling to bounce back from the Chinese trade war must now grapple with the realities of climate change that threaten to change the future of farming forever. Now, some farmers are implementing practices that could potentially reverse the effects of climate change â and provide a bigger profit. In this CBSN Originals documentary, Adam Yamaguchi travels to Nebraska, where he meets two farmers on different paths, both determined to pass their legacies on to the next generation.
Jul 26 23:07 
Beto O'Rourke returns to campaigning
In a speech Thursday, Democratic presidential candidate Beto O'Rourke attacked President Trump and called for gun control following the mass shooting in El Paso. Dallas Morning News political writer Gromer Jeffers joined CBSN to talk about O'Rourke's speech.
1H ago 08:30
