J.C. Penney's CEO-Designee Marvin Ellison, who assumes the position from long-time retail executive Mike Ullman on August 1, is rounding into form behind the scenes. "He has been driving the plans the last few months," said Ullman during a presentation at Piper Jaffray on Wednesday.
Ellison, who had a well-regarded 12-year career at home improvement retailer Home Depot ( HD) before joining J.C. Penney in October, has his work cut out for him in trying to deliver on some lofty sales and profit targets set by Ullman.
Last October, J.C. Penney projected it would add about $2 billion in sales and $1.2 billion in earnings before interest, taxes and depreciation (EBITDA) by the end of 2017 by jazzing up its product line-up and getting back to retail basics.
Ellison appears to be up for the challenge of helping revive the 113-year old retailer. "The culture means something to me -- this was an opportunity too good to pass up," said Ellison on why he jumped ship to a department store retailer that during 2013, and most of 2014, was still correcting serious operational mistakes from its former CEO Ron Johnson and racking up big losses.
Ellison outlined three areas that he will be focusing on at J.C. Penney in the months to come.
1. Improve store layouts for better sales.
For J.C. Penney, as in most department stores, the center of the store is filled with ladies handbags, jewelry and men's and women's shoes. And at J.C. Penney, specifically the center at hundreds of its stores, also includes its hot Sephora cosmetics business. Ellison earmarked these departments as ripe for better execution.
The goal is to get people to walk into the center of the store, and as they walk out, interest them in buying other items. The center of the store is "essential for (driving sales amongst) female customers," noted Ellison.