Macy’s wants to re-create its physical store presence. But to do so, the US retailer still needs to get rid of a surplus of approximately 100 full-line stores, as announced in a recent corporate statement –the current portfolio comprehends 728 stores in total. Most of these stores are set to close in early 2017 and the locations will be announced once the company makes final decisions. “Nearly all of the stores to be closed are cash flow positive today, but their volume and profitability in most cases have been declining steadily in recent years,” said Jeff Gennette, Macy’s president who is designated to succeed Lundgren as chief executive officer in the first quarter of 2017.
The financial resources resulting of the stores’ shutdowns will be invested in both physical retail and the digital business. In ongoing stores, Macy’s mentions measures such as new vendor shops, expand shopping services such as those of personal stylists’ and accentuate high-potential businesses such as fine jewelry. In online, where the company has registered double digit-growth rate in each of the last fifteen years Macy’s is investing in capacity-building on its sites and apps, improvement in natural language search, faster page loading and simpler procedures for placing and fulfilling orders.
Macy’s also intends to capitalize on situations where the development or redevelopment of all or a portion of a real state holding exceeds the value of its existing use. Aligned with this, the retailer is in negotiations to sell the Macy’s Men’s Store on Union Square in San Francisco and build a men’s section within the main Union Square store, which is located across the street. The deal isn’t finalized yet, though.
From 2010 to 2016, around 90 Macy’s stores have been closed and thirteen new stores have been opened, together with six Macy’s Backstage offprice locations opened in fall 2015.