Inside Licensing News and Notes, March 5, 2018
J.C. Penney, Nordstrom Taking Different Approaches to Exclusive Brands
J.C. Penney and Nordstrom are taking different tacks in expanding their assortment of exclusive and private label brands.
While J.C. Penney is expanding its deployment of Sephora and Salon by InStyle shops, Nordstrom is eschewing store-within-a-store formats, in favor of more multi-year “strategic relationships” with brands. “That is not necessarily exclusive brands and we are not looking to have merchandise that’s exclusive for the sake of exclusivity,” Nordstrom CEO Erik Nordstrom told analysts. “We think the appropriate thing given the changing dynamics of our industry is to have more strategic partnerships with brands that are not widely, widely distributed.”
For its part, J.C. Penney is focusing on expanding its Sephora and Salon by InStyle shops. It will add another 30 Sephora shops this year in expanding the format to 671 locations and open another 100 Salon by InStyle locations, CEO Marvin Ellison told analysts. The company also will build out its women’s activewear business with further expansion of Nike and Adidas and the addition of Puma, Ellison said.
On the store front, Penney plans to close another seven locations this year, while Nordstrom plans to open its first men’s store in New York on April 12. Penney also is continuing with its reorganization, announcing Friday it would trim another 360 positions at headquarters and in stores. That’s on top of the 5,000 jobs cut last year with the closing of 141 stores.
Overall, Penney’s net income for Q4 ended Feb. 3 improved to $254 million from $192 million as it recorded a $75 million benefit from new federal tax laws. Its Q4 revenue increased 1.8% to $4 billion on a 2.6% gain in same-store sales. At Nordstrom, net income declined 32% to $151 million as it took a $52 million charged tied to tax assets. Revenue rose 8.4% to $4.6 billion on a 4.3% gain in same-store sales.
J.C. Penney, Jeffrey Davis, Chief Financial Officer, 972-431-1000
Nordstrom, Anne Bramman, Chief Financial Officer, 206-628-1211
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