Macy's was already in the process of winding down 28 stores during the first part of 2020. Far more going-out-of-business sales are on the way, so you'll want to make sure you have a cash-back credit card in your wallet — to save even more.
Cuts called deep but necessary
Macy's is cutting jobs, too, about 2,000 at its corporate offices and in support services.
"The changes we are making are deep and impact every area of the business, but they are necessary. I know we will come out of this transition stronger, more agile and better fit to compete in today’s retail environment," said Jeff Gennette, Macy's CEO and chairman, in a news release.
Macy's has evaluated the overall value and profitability of each of its stores to determine which locations will go dark. It will shed its least productive locations based on consumer trends and demographics, even though they generate approximately $1.4 billion in annual sales.
"We will focus our resources on the healthy parts of our business, directly address the unhealthy parts of the business and explore new revenue streams," Gennette says.
A makeover for Macy's
Macy’s dates back to 1858, when Rowland Hussey (R.H.) Macy opened a dry goods store at the corner of 14th Street and Sixth Avenue in Manhattan — several blocks south of the flagship store's now-familiar 34th Street location. (As in the classic Christmas movie The Miracle on 34th Street.)
The company has evolved into today's department store selling designer brands and popular fashions for men and women, and home goods. It’s also known for the huge Macy's Thanksgiving Day Parade, which first made its way down Broadway in New York in 1924.
Macy's stores anchor shopping malls throughout the U.S., but the company wants to break away from ailing malls and go to where the customers are. It's been testing out smaller stores in strip shopping centers.
“The more convenient, brand-right touchpoints we have, the greater loyalty and engagement we engender," says Gennette. "This will enable us to grow with the next generation of American shoppers.”
Closing 125 stores might sound like a drastic move, but Macy’s says it's focusing on growth and improvement. Executives say the closures should generate annual savings of $1.5 billion, and part of that will be invested back into the company.