Apparently J.C. Penny didn’t get Trump’s “Consumers are in the best shape ever” memo…
J.C. Penny, yes, that same J.C. Penny that has been a staple, for decades, in malls throughout America, is getting into the business of selling used clothes.
Though they’ll probably call it something like, “pre-worn” because while it is true that used clothes are also “pre-owned”, I’m not to sure the auto industry will take too kindly to J.C. Penny’s hijacking of the euphemism?
Nonetheless, a primer, from President Trump:
It is kind of hard to argue what “best shape ever” means.
Additionally, notwithstanding certain fetishes, “best shape ever” means “doesn’t have to buy used crap”.
But such is not the case.
Case in point: J.C. Penny.
From Yahoo Finance:
On Thursday, the Plano, Texas, company said it would be partnering with thredUP, a resale website where people can buy and sell clothes online.
OK, “Hey Half Dollar, buying and selling online is not the same as buying and selling used clothes in stores!”.
However, please let me finish my point:
J.C. Penney will open threadUP shop in 30 stores soon.
In other words, if you yearn for the smell of mothballs and the sight of dog hair clinging to moisture-wicking exotic synthetic fibers, and you’d rather go to the mall instead of Goodwill because the former has a Starbucks, then you’re in luck!
J.C. Penny selling used clothes does not appear to be some sort of “for a limited time only” guerrilla marketing stunt either.
It seems the intention is to become the mall leader in used-clothing sales:
“We are not simply running a business – we are rebuilding a business,” said CEO Jill Soltau said in a prepared statement. “We are making a difference and today, I feel more confident than ever that we will reinvigorate and rejuvenate this great company to sustainable, profitable growth.”
Now, I’m not mocking people who buy used clothes.
I have, I do, and I likely will continue to do so.
I will say this, however – just how is J.C. Penny going to compete when it comes to selling used clothes for profit?
First and foremost, we have the race to the re-seller bottom as I highlighted last week.
Secondly, how can a for-profit company compete in selling used clothes, at a profit no less, when non-profit agencies such as Goodwill get clothes donated to them for free and can sell the clothes at pretty much any price they’d like?
And before one says, “well, J.C. Penny can just focus on high end clothes to not have to compete with the drivel that is donated to Goodwill”, let’s consider that Goodwill has a pretty impressive online retail component with auction-style and buy-it-now style listings, and high end clothes are certainly a focal point with expensive brands and designer brands represented in force.
Finally, back to the “booming economy” narrative.
Because what is near the end of the Yahoo Finance article casts additional doubt on the narrative (bold added for emphasis):
Another struggling department store, Macy’s, cut its expectations for the year on Wednesday and fell far short of Wall Street’s profit expectations.
So there you have it: Many mall retailers are really struggling.
J.C. Penny will begin slinging used clothes in response.
In my opinion, this is a bad move for a dying retailer.
It’s only kept alive by “easy money” policies.
Which will continue until control is lost.
The Fed is losing that control now.
Government is losing it too.
Dark times are coming.
Here’s another dot.
– Half Dollar
About the Author
U.S. Army Iraq War Combat Veteran Paul “Half Dollar” Eberhart has an AS in Information Systems and Security from Western Technical College and a BA in Spanish from The University of North Carolina at Chapel Hill. Paul dived into gold & silver in 2009 as a natural progression from the prepper community. He is self-studied in the field of economics, an active amateur trader, and a Silver Bug at heart.