Macy’s, which is one of the most famous store names in the United States, has had a lot of problems lately. Because of changing shopping habits, the rise of online shopping, and economic problems, Macy’s has started a big plan to restructure that will see 150 stores close over the next few years.
Macy’s is making this move as part of a larger plan to adapt to the changing retail environment and set the store up for long-term success.
Legacy of Macy’s
It was opened in 1858 in New York City by Rowland Hussey Macy as a simple dry goods store. Over the next 100 years, it grew into a huge store, introducing innovations like set prices and newspaper ads.
When it opened in 1924, Macy’s Herald Square store became one of the biggest department stores in the world. It is still a cultural icon, in part because of the Macy’s Thanksgiving Day Parade.
During its busiest years, from about 2014 to 2015, Macy’s had about 850 shops across the US and made more than $28 billion a year. But as competition from online stores like Amazon grew and customer tastes changed, Macy’s started to lose its edge in the retail market.
Leadership Transition
Tony Spring, who is currently CEO of Macy’s, is in charge of the company during this time of change. Spring was hired as CEO of Macy’s in March 2023. Before that, she was CEO of Bloomingdale’s.
His appointment as CEO comes at a crucial time for the company, which has to close stores and restructure its operations. Spring has said that the underperforming stores are still important real estate assets, even though they have been closed. This suggests that Macy’s may hold on to some properties for future strategic reasons.
Macy’s Closing Its Stores
The choice to close 150 shops is part of a bigger plan to deal with how people are changing the way they shop. The rise of online shopping has had a big effect on Macy’s and many other brick-and-mortar stores.
People walking into shops has gone down because many people prefer the convenience of shopping online. Another thing that has hurt department store sales is off-price stores and the growing trend of people putting experiences over things.
Macy’s has divided its shops into “go-forward” and “non-go-forward” areas to deal with these problems. The “non-go-forward” shops are ones that aren’t doing well, so Macy’s will close them to help the company as a whole.
By closing the shops, Macy’s will be able to save money and put that money into its online business and stores that do better.
Macy’s Real Estate
Macy’s is going to close these shops that aren’t doing well, but the company still sees its real estate as an asset. Some of the shops that are closing have great locations and could be used for something else or sold to someone else.
This plan fits with Macy’s ongoing attempts to put money into more profitable areas, like its high-end brands. The company is putting more money into Bloomingdale’s and Bluemercury, two shops that have done well, in addition to focusing on Macy’s stores that make money.
Over the next three years, Macy’s wants to open 15 new Bloomingdale’s stores, at least 30 new Bluemercury stores, and remodel about 30 Bluemercury shops that are already open.
Planned Store Closures
Macy’s plans to close 95 stores by 2026. The first 55 stores will close by December 2024. After these shops close, Macy’s will still have about 350 stores across the country.
The company hasn’t shared an official list of the stores that will be closing yet, but rumors say that some well-known locations, like the Macy’s store in San Francisco’s Union Square, are likely to close at some point.
Future of Macy’s
Even though Macy’s is cutting back, the company is still focused on changing with the times in the retail industry. The company still has a big influence in retail, with 519 Macy’s stores, over 150 Bluemercury stores, and 56 Bloomingdale’s stores.
Macy’s wants to stay competitive in a tough market by changing its plan to put more money into online shopping and high-end stores. The fact that Macy’s is closing 150 stores shows how the retail industry is changing.
Online shopping and changing customer habits have changed the way people shop. While Macy’s deals with these problems, the fact that it is focusing on smart real estate choices, investing in luxury brands, and building a stronger online presence shows that it is determined to adapt and do well in this new age of retail.
Many physical stores are closing down at the end of an era. For Macy’s, however, it’s the start of a new chapter as it tries to stay modern and important in the years to come.
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