Macy's is closing approximately 150 underproductive locations by 2026 to focus on luxury growth and Bloomingdale's expansion. This decision is part of a broader initiative to concentrate on enhancing the luxury market presence of Bloomingdale's brand. The closures are aimed at underproductive locations, representing about 30% of all Macy's stores, allowing the company to reallocate resources to approximately 350 "go-forward" stores.
The move, described by Macy's as "A Bold New Chapter," is expected to strengthen the Macy's nameplate and improve customer relationships through enhanced shopping experiences, relevant assortments, and compelling value.
Macy's CEO Tony Spring, who recently took over the role after leading Bloomingdale's for nine years, has emphasized the importance of this transition in reinvigorating the company's connection with its customers.
“A Bold New Chapter serves as a strong call to action. It challenges the status quo to create a more modern Macy’s, Inc. We are making the necessary moves to reinvigorate relationships with our customers through improved shopping experiences, relevant assortments and compelling value,” said Tony Spring, chief executive officer, Macy’s, Inc. “Our teams are energized by the work ahead as we accelerate our path to market share gains, sustainable, profitable growth and value creation for our shareholders.”
Despite the planned store closures, Macy's is not retreating from the retail scene.
Macy’s, Inc. is embarking on a plan focused on three main goals:
- Enhancing the Macy's Brand: The company is adopting a customer-centric approach to reignite sales growth by refreshing product selections for better appeal and value, modernizing the shopping experience for seamless interaction across all platforms with a special emphasis on digital innovation, and investing in the most promising locations. This involves closing roughly 150 less productive stores, including about 50 by the end of this fiscal year, while focusing on improving around 350 key stores and expanding smaller format outlets.
- Boosting Presence in the Luxury Sector: Macy’s, Inc. plans to capitalize on its successful performance in the luxury segment through Bloomingdale’s and Bluemercury by increasing the number of stores and enhancing online offerings. This expansion includes opening an estimated 15 new Bloomingdale’s locations and a minimum of 30 Bluemercury stores, along with remodels of approximately 30 existing Bluemercury stores over the coming three years.
- Streamlining and Updating Company-Wide Practices: The company is set to overhaul and optimize its supply chain, streamline delivery processes, enhance inventory management, and develop a robust technology framework. These steps are aimed at aligning operations with projected omnichannel demand and creating a more effective business model that will improve service to customers.
This strategic refocusing comes after Macy's had already announced the closure of five stores located in Arlington, Virginia; San Leandro, California; Lihue, Hawaii; Simi Valley, California; and Tallahassee, Florida, which are set to close in early 2024. These closures are part of Macy's efforts to stabilize sales by shutting down underperforming stores and enhancing customer service and product lines.
As Macy's embarks on this new chapter, it is also streamlining its operations, which includes reducing its workforce by 3.5%, equating to approximately 2,350 jobs. This downsizing is part of a larger effort to become a more streamlined company capable of adapting to the changing consumer marketplace.
