You will do a SWOT analysis of JC PENNEY. You will not count year 2020 in your analysis, only data from 2019 and before that is relevant. I have uploaded the SWOT instructions and explanation. I have

SWOT Analysis JC Penney Company Inc, SWOT Analysis Strengths Weaknesses Strong Supply Chain Omni-Channel Presence Diversified Product Mix Low Inventory Turnover Ratio Opportunities Threats Increasing Online Retailing Increasing Apparel Market in the US Iniatiatives of Capital Expenditure Stringent Regulations Increasing Labor Wages in the US Intense Competition Source : GlobalData Financial Performance The company reported revenues of (US Dollars) US$12,019 million for the fiscal year ended February 2019 (FY2019), a decrease of 6.6% over FY2018. The operating loss of the company was US$29 million in FY2019, compared to an operating profit of US$179 million in FY2018. The net loss of the company was US$255 million in FY2019, compared to a net loss of US$118 million in FY2018. JC Penney Company Inc JC Penney Company Inc- Financial and Strategic Analysis Review Reference Code: GDRT30446FSA Page 2 Key Information JC Penney Company Inc, Key Information Corporate Address 6501 Legacy Dr, PLANO, TX, 75024-3698, United States Ticker Symbol, Stock Exchange JCP [New York Stock Exchange] Telephone +1 972 2431100 No. of Employees 95,000 Fax +1 302 6555049 Fiscal Year End February URL ir.jcpenney.com Revenue (in USD Million) 12,019.0 Industry Consumer Goods, Retail, Wholesale & Foodservice Locations United States Source : GlobalData Company Overview J. C. Penney Company, Inc. (J. C. Penney) is a holding company, which operates a chain of department stores in the US and Puerto Rico. It offers a comprehensive range of watches, beauty products, apparel, home furnishings, accessories, footwear, hand bags, jewelry, shoes,and bed and bath products. It provides services such as jewelry repair, custom decoration, salons, optical centers, portrait studios, flower bouquet shops, and gift cards. It also offers merchandise through online websites including www.jcpenney.com and www.jcpenney.net. J. C. Penney is headquartered in Plano, Texas, the US. The company operates an international purchasing subsidiary, which maintains purchase and quality assurance offices in foreign countries.

JC Penney Company Inc JC Penney Company Inc- Financial and Strategic Analysis Review Reference Code: GDRT30446FSA Page 3 JC Penney Company Inc - SWOT Analysis SWOT Analysis - Overview JC Penney Company Inc (JC Penney) is one of the leading retailers in the US. Efficient supply chain, omni-channel presence of the company and diversified product mix are the company’s main strengths, whereas lower inventory turnover ratio remains areas of concern. Growing online retailing, capital expenditure initiatives and growing apparel market in the US are likely to provide growth opportunities to the company. In the future, Expansion by rising labor wages in the US, regulations and intense competition could affect its growth.

JC Penney Company Inc - Strengths Strength - Strong Supply Chain The suppliers of the company comprise numerous domestic and foreign vendors with none accounting for more than 5% of its net purchases. JC Penney has a well-diversified supplier base, which helps it control its dependence on suppliers. As of February 2019, the company operates through a network of 864 department stores in 49 states of the US and Puerto Rico with a total retail space of 95 million sq. ft. Strategic placement of these stores ensures quick merchandise delivery and low transportation costs. J C Penney operates 11 distribution centers, one each in the states of Connecticut, Kansas, Ohio, Georgia, Nevada, North Carolina, Utah; and two each in California and Texas.

Strength - Omni-Channel Presence With a strong focus on providing an enhanced shopping experience to its customers across all its channels, the company is well-positioned to attract a larger base of customers, which, in turn, helps in increasing product sales. The company offers free same-day pickup in most of its JC Penney stores in the US and most orders can be shipped to any JC Penney store in the country. The company also offers same-day delivery option in selected markets. In order to meet the growing needs of customers, the company follows an omni-channel approach, which helps in driving growth. JC Penney focuses on improving the shopping experience for its customers by investing in technology and resources to support various channels of shopping, including in-store, smartphone, desktop and tablet. For instance, in response to growing usage of mobile devices for shopping, the company developed a new JC Penney application for iPhone. Nearly half of all jcpenney.com traffic comes from the mobile channel, hence this new application further enabled the company to drive growth. This new application help customers shopping inside a JC Penney store find coupons and apply them at the register. The new application also allows users to scan an item's barcode to access product information and customer reviews, as well as determine its availability online or at nearby stores. Furthermore, the company offers various delivery options to its customers. JC Penney is also focusing on providing a same-day pickup option to its customers, which builds on the existing pickup in store capability.

Strength - Diversified Product Mix In FY2019, the contribution by these categories to the total revenue of the company has been 22%, 21%, 14%, 13%, 9%, 8%, 7% and 6%, respectively. The company’s merchandise mix includes women’s apparel, men’s apparel and accessories, home, women’s accessories, including Sephora, children’s apparel, footwear and handbags, jewelry and services and other. JC Penney offers a diversified product portfolio, which gives it a wide customer base. The company is an exclusive retailer of brands such as JC Penney , Worthington, a.n.a, JCP, Liz Claiborne, Claiborne, Okie Dokie, St. John's Bay, The Original Arizona Jean Company, Ambrielle, Decree, Stafford, J. Ferrar, Xersion, monet, Disney, MSX, Eva Longoria Home, jeans by Buffalo, Black Label by Evan Picone and nicole by Nicole Miller among others.

JC Penney Company Inc - Weaknesses Weakness - Low Inventory Turnover Ratio Lower inventory turnover than competitors indicates that the company takes more days to clear its inventory in comparison with its competitors. In FY2019, JC Penney reported inventory turnover ratio of 3. It reported lower inventory turnover ratio compared to two of its major competitors, Nordstrom Inc and Target Corporation (Target) which reported inventory turnover ratio of 5.1 and 5.9 in FY2019. JC Penney reported weak inventory turnover ratio during the review year. With the given turnover ratio, JC Penney takes 122 days to sale its inventory compared to 72 days by Nordstorm and 62 days by Target.

The decline in the turnover ratio and higher inventory turnover days signify that the company incurs high inventory carrying costs, which affect its operating performance.

JC Penney Company Inc - Opportunities Opportunity - Increasing Online Retailing According to in-house research, online retail sector in the US is forecast to grow at a CAGR of 8.5% during 2017-22 to reach US$447.4 billion by 2022 from US$297.8 billion in 2017. Multi-channel retail was the leading mode of sale in the US retail sector in 2017, accounting for 58.2% share, while online pureplay accounted for the remaining 41.8%. The US accounts for about 32% of the global online retail sector value. The retailing of electrical and electronic goods was the largest segment in the sector in 2017, which accounted for 35.7% of the total value, followed by apparel retail (22.6%), JC Penney Company Inc JC Penney Company Inc- Financial and Strategic Analysis Review Reference Code: GDRT30446FSA Page 4 home and garden products (12.1%), food and grocery retail (11.6%), furniture and floor coverings (4.2%), and footwear (3.5%). Other category accounted for 10.3% of the value. The company merchandises its products online through www.jcpenney.com. The use of smart phones, tablets and other internet enabled devices contributed to growing E-commerce market. With the increase in interactive methods and limitless content, the retail e-commerce is growing at a faster rate.

Opportunity - Increasing Apparel Market in the US According to in-house research report, the US apparel industry grew by 1.2% in 2017 to reach a value of US$327.2 billion and it is further expected to reach US$351.5 billion in 2022, growing at a CAGR of 7.4% during 2017-2022. In September 2019, the company launched St. John’s Bay brand outdoor lifestyle apparel products for men. The womenswear category generated US$170.9 billion, accounting for 52.2%, the menswear generated US$101 billion, accounting for 30.9% and children’s wear category generated US$55.3 billion, accounting for 16.9% to the total apparel industry in the US. The growth was essentially the result of purchasing power of young middle class people, technological advancements and increasing popularity of online shopping. The company could benefit from the growing apparel market in the US. JC Penney offers sportswear, designer jewelry, decorative home accessories, handbags, shoes, cosmetics, men’s clothing and accessories, women’s couture and designer apparel, and children’s apparel.

Opportunity - Iniatiatives of Capital Expenditure In FY2019, JC Penney invested US$392 million for restructuring the business. It primarily invested US$141 million on store renewals and updates; US$129 million on capitalizing software; US$109 million on technology initiatives and US$13 million for the opening of new stores and relocation of existing stores. During the review year, the company opened one new store and closed nine stores. These initiatives will help it decrease operational expenses and enable to better deploy its resources, which result in increase in operational profitability. In FY2020, JC Penney announced its plans to invest US$300 million to US$325 million, with major focused on retail store, e-commerce and information technology projects. The company stands to benefit from its recent corporate restructuring initiatives.

JC Penney Company Inc - Threats Threat - Stringent Regulations The imposition of taxes by state and local governments could create administrative burden on the company. These include regulations are related to taxation, privacy, data protection, pricing, content, copyrights, electronic device certification, electronic waste, consumer protection, the provision of online payment services, the design and operation of websites, and the characteristics and quality of products and services. The company is subject to various regulations governing the internet, e-commerce and electronic devices in addition to general business regulations and laws. Currently, the US Supreme Court decisions restrict the collection of state and local taxes for Internet sales. But, a number of states and the US Congress have been considering initiatives, which could limit the Supreme Court’s position regarding sales and use taxes related to Internet sales. If these initiatives are successful, JC Penney could be required to collect sales and use taxes in additional states or change its business practices.

Threat - Increasing Labor Wages in the US The tight labor markets, government mandated increases in minimum wages and a higher proportion of full-time employees could result in an increase in labor costs. In FY2019, JC Penney employed more than 95,000 associates for conducting its business operations. The federal minimum Labor costs are rising significantly in the US. The federal minimum wage provisions are contained in the Fair Labor Standards Act (FLSA). As of January 2019, the minimum wage rate in the US was US$7.2 per hour. The minimum wage rate in 29 states and the District of Columbia is more than the federal rate.

These wages range from US$13.2 in District of Columbia, US$12 in Massachusetts and Washington, US$11.1 in Colorado, US$11 in Arizona, US$10.8 in Vermont, US$9.9 in Arkansas, US$8.5 in Florida, US$8.2 per hour in Illinois. The minimum wage in the District of Columbia reached US$13.3 per hour. Increasing manpower costs could impact its stability and operational efficiency.

Threat - Intense Competition The major competitive factors include style, quality, price, merchandise mix, brands, service, customer experience and convenience. JC Penney competes with traditional department stores, upscale mass merchandisers, internet and specialty stores and other forms of retail commerce. The company competes directly with larger retail players such as Macy's, Kohl's Corporation, Nordstrom Inc, Sears Holdings Corporation, Belk Inc and Neiman Marcus Group Inc, among others in many of the markets it operates. These retailers have large market presence and larger economies of scale, which provide greater power to negotiate for better margins with vendors. Therefore, the company will have to constantly differentiate itself from its competitors through efficient and in trend merchandising, and attractive promotional programs in order to retain its market share.

JC Penney Company Inc JC Penney Company Inc- Financial and Strategic Analysis Review Reference Code: GDRT30446FSA Page 5 NOTE: The above strategic analysis is based on in-house research and reflects the publishers opinion only