Amazon has been tipped to potentially take over the collapsed US department-store giant JC Penney in a move which could redefine the nature of US retailing.
Amazon has a team of senior management and consultants at JC Penney’s Texas headquarters going through the numbers and the store portfolio – according to an exclusive report by WWD.
If Amazon was to buy JC Penney, it is hard to see the brand name enduring. Analysts estimate, on average, that Amazon has cash reserves of around US$43.7 billion, so buying the business, taking over the properties and completely reformatting stores would be a lesser challenge cost wise than for any other retailer.
The vast majority of JC Penney stores anchor shopping malls, many of which are struggling to retain footfall and have relatively short life expectancies, worsened in a post-Covid-19 world where social distancing is likely to endure until a vaccine is found or the coronavirus dies out of its own accord.
Amazon could potentially convert the JC Penney stores into a tech-driven, hybrid model of fulfilment centre and retail showcase. This would give its online customers a place to view goods in a truly omnichannel business model similar to what traditional brick-and-mortar retailers around the world – and e-commerce giants like Alibaba and JD in China – have been trying to develop during the latter half of the last decade.
