JCPenney_AR2007

JCPenney_AR2007 - easy, table of contents 04 06 10 12 14 16...

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table of contents 04 message to our stockholders 06 easy to shop 10 exciting concepts 12 exciting power brands 14 exciting reasons to choose JCPenney 16 engaging our customers 18 connecting with our communities 20 board of directors and executive board 21 financial highlights 22 stockholder information easy,
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exciting, engaging three simple words three big ways to focus on our customer and make every day matter
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4 Dear JCPenney Stockholders: Over the past year, the economic pressure on American families increased dramatically, impacting our Company and our industry. Within this tough climate, I am proud of the performance of our Associates and the competitive advantage we are continuing to build. And I have even more confidence in the strength of the Long-Range Plan strategies we are pursuing to become the growth leader in the retail industry. In periods like this, our customers are relying on us more than ever to provide merchandise that has the great style and quality they are looking for at smart prices, and a shopping experience that is easy, exciting and engaging. With this in mind, as the economic downturn began in mid-2007, we continued to put our customers at the center of all that we did. We also took action to reduce expenses and manage our inventories, enabling us to maintain the financial strength and flexibility to support our Long-Range Plan, while taking steps to reflect current realities. For 2008, our intention is to focus even more intently on putting our CustomerFIRST. This will be evident in the strength of our merchandise offerings, the emotional connection of our marketing and promotions, and most of all, in the way our Associates interact with our customers. In short, our “Every Day Matters” philosophy will be more apparent than ever as we work to achieve our goal of being the preferred shopping choice for America’s families. A Year of Challenge and Triumphs While we began to see evidence of a slowdown in early 2007, the drop in home sales and prices, tighter consumer credit and escalating fuel and food prices led to a precipitous decline in U.S. consumer spending in the second half. As we recognized the change in the retail environment, we acted to address these challenges by moderating our business plans, capitalizing on our centralized operating model. The changes we undertook included accelerating certain promotions to remain competitive in the highly promotional climate in the third and fourth quarters. This price optimization approach enabled us to effectively clear seasonal merchandise and left us with appropriate levels of inventory as 2008 began. We also rolled out expense-saving initiatives, utilizing our workforce management technology to alter our staffing and salary plans across our stores. In general, we ensured that our selling floor had ample Associate coverage during peak shopping times, while reducing our staffing during less active periods. In addition, SG&A benefited greatly from lower costs related to pension expense and incentive
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This note was uploaded on 06/05/2008 for the course ASC 102 taught by Professor Ming during the Spring '08 term at UC Riverside.

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JCPenney_AR2007 - easy, table of contents 04 06 10 12 14 16...

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