Resource Based View

This session analyzes JCPs resources including its image, store network, cost
management system, and cash reserves by determining whether the resources are
valuable (V), rare (R), costly to imitate (I) and organizationally exploited by the company
(O). Based on these components, the study will also provide the resources competitive
consequences (CC) and their performance implications (PI).
Resource
JCPenney's Image
Store Network
Cost Management System
Cash Reserves

V
Y
Y
Y
Y

R
N
N
N
N

I
-

O
N
N
N
Y

CC
CD
CD
CD
CP

PI
BAR
BAR
BAR
AR

JCP possess the second largest store network among all firms in the industry. As
of February 1, 2014, JCP has 1,094 stores in 49 states of the United States. Wide store
network is valuable to JCP because revenue earned in stores from 2011 to 2013 totaled
$38,504 million, contributed 91.44% to total revenue in the same period. The resource is
not rare since other firms in the industry also operate stores nationwide and are
attempting to launch new stores, expanding their store network and reaching to more
areas. However, JCPs store chain has not been well exploited by the firm, as in-store
sales reduced 20.92% from $15,760 million to $10,779 million (CAGR 11-13). In
addition, revenue earned per store square foot also declined 20.09% from 212 million to
147 million (CAGR 11-13). The company also plans to close down 33 unprofitable stores
in 2014 as a step towards cost saving initiative, which is a largest number of stores within
the last five years. This resource, therefore, is JCPs competitive disadvantage and
generate below average returns.