The department store J.C. Penney, which has been around since 1902 and was founded in Texas, has filed for bankruptcy amid the COVID-19 global pandemic. The store has struggled financially in recent years and now faces massive debt. The coronavirus pandemic was what finally caused it to break under the pressure, according to Today.
J.C. Penney's financial struggles first began in 2016 when it experienced lower sales than normal. In every year since then, its sales have continued to decrease. In February of 2020, the company employed an estimated 90,000 full- and part-time employees in its stores. However, the coronavirus forced it to lay off employees and shut the doors of its many stores.
J.C. Penney CEO Jill Soltau made a statement regarding the financial struggles the company has faced and how it was impacted by the pandemic.
"The Coronavirus (COVID-19) pandemic has created unprecedented challenges for our families, our loved ones, our communities, and our country. As a result, the American retail industry has experienced a profoundly different new reality, requiring J.C. Penney to make difficult decisions in running our business to protect the safety of our associates and customers and the future of our company."Soltau went on to say that before the pandemic hit, the company was making strides to recover business and get on its feet again. It had enacted a new plan to increase sales and pay off debt. While it seemed to be working, all of the progress was halted when the pandemic occurred.
"While we had been working in parallel on options to strengthen our balance sheet and extend our financial runway, the closure of our stores due to the pandemic necessitated a more fulsome review to include the elimination of outstanding debt," Soltau's statement continues.
Not all stores will immediately close. Some locations are still offering curbside pickup, allowing customers to order online and pick up their items without entering the store. Around 180 to 200 stores will be closing in the near future. The company will be working hard to help the remaining stores survive and get business back on a positive track.
As The Inquisitr previously reported, J.C. Penney is hardly the only retailer that has been affected negatively by COVID-19. Neiman Marcus also filed for bankruptcy earlier this month after suffering from extremely low sales. Even though it had to completely close its stores in many locations, some stores are offering curbside pickup. The clothing retailer J. Crew endured similar problems and has also filed for bankruptcy.