Last year, I wrote about how three men opened a retail store called The Golden Rule in 1902. In 1907, two of the men dissolved their partnership and third man bought all the rights to the store. Over the next few years his business grew and his stores branched out into other cities. In 1913, he consolidated all of his stores and placed them under his own name, James Cash Penney – JC Penney.
Towards the end of the Great Depression, Penney almost lost his business and everything he owned. The stress ended up putting him into a sanitarium where he heard a hymn that touched him so deeply that he became a born-again Christian. From that time on, Penney ran his company using biblical principles and the JC Penney stores flourished and spread across the country.
James Cash Penney died in 1971 at the age of 95. His company continued to prosper until new management began to enter the scene and replace many of his biblical policies with non-biblical ones. In 2012, JC Penney CEO Ron Johnson saw the company floundering, so he decided to woo in the gay market. He contracted with gay actress Ellen DeGeneres to advertise for the company and openly endorsed gay marriage. Many people were offended by the gay advertisements and the company’s stand on gay marriage. JC Penney’s sales dropped even more.
In Aug of 2012, Johnson announced that the company was going to start reducing the number of sales staff at checkouts by installing radio frequency identification (RFID) and Wi-Fi enabled checkouts. The transition was supposed to be accomplished by the end of this year.
By the end of 2012, JC Penney’s quarterly sales had dropped 26% over the previous year. In an overall analysis of the retail industry, 24/7 Wall St. estimated that JC Penney would be closing 300-350 stores by the end of 2013 in an attempt to remain solvent.
On Monday, the JC Penney board of directors decided that 17 months of Ron Johnson’s leadership was more than they could handle and removed him as CEO. Johnson is being replaced by former CEO Myron E. Ullman III.
I’ll be interested to see if the company changes its policies on gay marriage and gay rights. If not, I can only hope that the company’s sales continue to plummet until they are forced to shut the doors on all of their stores. I’m certain that if James Cash Penney were still alive, he would agree.