Recognized US department store chain, Macy’s, has indicated that it will be accelerating its plan to close several stores throughout the year. This statement comes on the back of prevailing economic challenges and changing consumer shopping habits perpetuated by a global pandemic.
According to Macy’s representative, approximately 125 “off-mall” stores will be shut down during the next three years. This is a part of the company’s comprehensive strategy to ramp up its online business and shift focus to more profitable shopping mall outlets. The decision is expected to affect thousands of jobs across the US.
While the exact timeline for these closures is not revealed, it is understood that the process is about to accelerate. Macy’s move to swiftly close its less profitable stores will align the firm with current market trends, by enhancing its digital footprint and concentrating on high grossing physical locations.
Moreover, Macy’s has previously announced a three-year Polaris strategy in 2020 with the intention to stabilize the business, drive top-line growth, and increase profitability. The store closures are a significant part of this plan. Executing the strategy is necessary as, according to Market Research, the department store industry has experienced a downward trend in the last five years.
Despite the massive store closures, Macy’s has reassured its customers and stakeholders that the company is committed to a strong omnichannel presence, comprising both online and physical store sales platform.
In comments to the media, Jeff Gennette, CEO of Macy’s, stated, “While store closures are a difficult decision, turning off less-profitable locations would ultimately allow us to maintain a healthier portfolio.” He further added, “The strategy aims at ensuring Macy’s future as a dynamic retailer that serves existing customers and attracts new ones.”
With an increasing number of consumers shopping online, traditional brick-and-mortar stores have been struggling. Enhancing Macy’s digital offering and focusing on profitable stores seems to be a sure way for the retailer to adapt to this ever-changing commercial landscape.
Last modified: December 13, 2024
