Macy’s closed 40 stores earlier this year, including its stores at the Roseburg Valley Mall in Roseburg and the Pony Village Mall in North Bend.
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But Macy’s CFO Karen Hoguet still believes there’s one major advantage its retail stores have over its e-commerce competitors: physical space. Macy’s hasn’t announced which locations will close, but said they represent about $1 billion in annual sales, excluding sales the company expects to retain online or at nearby stores.
Although numerous closing stores have been making a profit, company officials say they’ve been on a downward spiral. Other locations in the state might also be at risk, he said.
The closures are Macy’s latest effort to adapt to shifting consumer preferences for online shopping, CNNMoney reported.
“While we understand that customers may use department stores for trial and shopping across brands, the high level of promotional impressions created negatively impacts our long-term brand health”, Coach Chief Executive Victor Luis told analysts during a presentation.
Gennette said they are closing a large number of stores “proactively” to better invest in the most profitable and “highest-potential locations”.
Macy’s had been a stellar performer since the Great Recession, but in the past year and a half has seen slowing sales as it battles competition on all fronts and changing shopping patterns.
Millennial consumers, at their peak years of spending, are certainly buying clothes, but they’re doing so mostly at discount stores like T.J. Maxx or fast-fashion chains like H&M.
U.S. department stores have been suffering from a drop in footfall at the nation’s malls and from increasing competition from online giants such as Amazon. The plan includes bringing in more brand shops within the stores, improving online search and ordering, and hosting in-store events to drive traffic.
Metrick, standing Wednesday evening near Saks’ new outdoor cafe that overlooks Manhattan’s Rockefeller Center, says there is plenty of hope for department stores that make themselves essential.
Macy’s did mention one prominent location that is likely to close: the stand-alone Men’s Store in downtown San Francisco.
Unlike the Gap – which is also shedding hundreds of stores due to online pressures – Macy’s owns most of its stores and the land they’re on.
Macy’s employed 157,900 full-time and part-time workers at the end of January. However, Mall sources say that expansion was never set in stone, but more likely “allowed” within the overall redesign plan for the Mall.
The Seattle retailer’s quarterly earnings came in above predictions, though sales at its full-line stores were down 6.5 percent.
“What you have is a cascading effect”, Millman said. Sales at Macy’s stores open at least a year were down 2.6 percent compared with the second quarter of 2015, the sixth consecutive quarter in which comparable sales dropped.
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“Nearly all of the stores to be closed are cash positive today”, Jeff Gennette, Macy’s Inc. president, said, “but their volume and profitability in most cases have been declining steadily in recent years”. The retailer’s revenue was $US5.87 billion ($A7.64 billion), down 3.9 per cent from the same period a year ago.
