Macy’s announced today it will be closing 100 stores, or about 15 percent of its retail locations, by early 2017.
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The Macy’s at the Ohio Valley Mall operated as Kaufmann’s from 1979 until a 2005 corporate merger led the company to change the store’s name. 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.
Macy’s announcement that it will be shuttering 100 of its department stores failed to mention one crucial piece of information – which locations will be axed. While the move makes sense from Macy’s perspective, “it’s a death sentence for the mall and all the other retailers associated”, particularly at smaller shopping centers, he said.
Manning said Shell Chemicals coming to the area could mean everything for the mall, which is now for sale. “Amazon has really become the big dog on the block when it comes to that kind of retail and it’s not surprising those other firms like Sears and Best Buy are struggling to compete”.
Macy’s has locations at both Northgate Mall and the Streets at Southpoint.
Macy’s will add new vendor shops in stores and create new in-store events and experiences.
“We operate in a fast-changing world” that requires “doing things differently and making tough decisions”, Macy’s Chief Executive Terry Lundgren said in a statement.
The Cincinnati-based retailer broke the news Thursday in a press release that accompanied its second-quarter earnings report.
The company said it was sticking to its outlook. Home Depot, for instance, reported a 6.5 percent rise in sales in the first quarter of the year. Eligible full-time and part-time associates who are laid off will be offered severance benefits. It is in talks to sell its Men’s Store on Union Square in San Francisco for redevelopment. The closures highlight the decline in profitability in many of its brick-and-mortar locations, and an increased focus in digital sales.
Shareholders’ net income fell to $11 million, or 3 cents per share, in the second quarter from $217 million, or 64 cents per share, a year earlier.
Following the closure, Macy’s will concentrate on its best-performing stores.
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The closures are Macy’s latest effort to adapt to shifting consumer preferences for online shopping, CNNMoney reported.
