J.C. Penney halves losses, will sell used clothing

Shares of J.C. Penney surged after the ailing department store cut its quarterly losses in half and announced it would begin selling used clothing to staunch fading sales.

Retailers have been searching for ways to get people back into its stores in the decade since the global economic downturn altered consumer behavior, a period that has run parallel with the ascent of Amazon.com.

Among the worst hit has been J.C. Penney, a company that traces its roots back to 1902 and just received a de-listing warning from the New York Stock Exchange because its shares have fallen below $1.

On Thursday, the Plano, Texas, company said it would be partnering with thredUP, a resale website where people can buy and sell clothes online. J.C. Penney will open threadUP shops in 30 stores soon.

“We are not simply running a business — we are rebuilding a business,” 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.”

It would not be the first time the company has shifted in unexpected directions, notably and disastrously under former Apple executive Ron Johnson.

But the company needs to find a way to turn things around.

Sales at established stores, a crucial measure of a retailer’s health, have eroded steadily. Same store sales tumbled 9% in the second quarter, or 6% when the impact of the company’s exit from major appliance and in-store furniture sales are accounted for.

The decision to bring appliances and furniture back into stores did not generate the traffic or sales it has hoped.

The company was able to clear troublesome levels of inventory.