JCPenney is quietly jacking up its prices so the retailer can later mark them down, the New York Post is reporting.
CEO Mike Ullman supposedly implemented the strategy this month "with especially lofty markups in the jewelry department," the Post's James Covert reported, citing multiple unnamed sources.
Marking prices up now enables the company to trigger deep discounts later — specifically, around Valentine's Day — without hurting margins too much.
The Post found several examples, particularly in the jewelry department, where JCPenney has allegedly hiked prices by as much as 225% since December.
Specifically, a half-carat diamond ring set in white gold was listed for $1999.98 on Wednesday, which is up from $1245 in December. The Post also identified a pair of gold earrings that were listed for $200 in December and now cost $449.98.
We reached out to JCPenney for comment on the report and will update when we hear back.
JCPenney, which recently announced it would be closing 33 failing stores, has struggled to turn a profit since former CEO Ron Johnson was fired in April.
Johnson was highly criticized for alienating millions of customers by doing away with discounts and coupons.