This holiday season, J.C. Penney CEO and Chairman Myron E. Ullman III is armed with a lineup of exclusive fashion brands he helped bring to the department-store chain, and he's ready to battle such key rivals as Macy's.
During more than 20 years in retailing, Ullman has seen a slew of competitors go out of business and -- as Macy's CEO in the early 1990s -- even succumbed to a hostile takeover bid, from Federated Department Stores.
But he says that nothing presented the kinds of challenges that Penney's and other stores face now.
He says he believes that this recession has permanently made consumers more frugal.
Here are some excerpts from an interview with Ullman at the new store in Manhattan's Herald Square.
Q. What has it been like to navigate the biggest consumer-spending downturn in decades?
A. It is an especially important time to be clear in our communications, in how we are going to focus our efforts. We made a conscious decision to moderate some of our behavior: expenses, capital, inventories. We wanted to maintain our focus on some of our key principles, like our key brands.
Q. How have your consumers' habits changed?
A. We are dealing with a middle-income consumer (who) has been the one with the most changes in terms of discretionary behavior. The bottom quartile is very focused on the daily needs. The top quartile has resources and is not concerned about the day-to-day things.
There is this new normal. People are going to be very pragmatic.
Q. How prepared do you feel about the holiday shopping season?
A. A year ago, we had way too much inventory, so our primary issue was how we were going to get rid of this stuff. This year, we have our inventory invested in key categories. We are much better positioned to take care of the customer on the things that we think they are going to want for Christmas.
Q. Analysts say that the line between Macy's and Penney is blurring as you add more big-name brands. With your new store just a few blocks away from Macy's flagship in Manhattan, that battle appears to be even more heated.
A. I have a lot of friends at Macy's. I think they have got some challenging issues of their own in terms of their merger with the May Co. They need to focus on their business (but) I am going to focus on taking as much of their business away as possible. That's my job.
Q. What have been some of your personal experiences that have shaped you as a leader?
A. I had four natural boys and adopted two (daughters) from Hong Kong. Both were handicapped. What influenced my life was watching those four boys taking care of the two girls.
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