US department store chain Macy’s is set to close 150 unproductive stores by 2026 as part of a strategic plan to reposition the company and return it to enterprise growth.
Named “A Bold New Chapter”, the initiative is aimed at streamlining operations and concentrating on the company’s core business.
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By the end of 2024, the retailer plans to shut down 50 stores. At the same time, it will invest in 350 go-forward locations and expand its small-format stores.
The strategy also outlines the opening of 15 Bloomingdale’s nameplate stores and 30 new Bluemercury stores.
A further 30 Bluemercury remodels will be launched in both new and existing markets over the three years to 2026.
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Macy’s is focusing on modernising the shopping environment to offer a seamless customer experience across all channels, with a particular emphasis on digital excellence.
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By GlobalDataIt also intends to rationalise and monetise its supply chain asset portfolio, streamline fulfilment and enhance inventory planning and allocation.
The decision to close an additional 150 Macy’s locations follows the company’s move last month to shut down five stores and eliminate 2,350 jobs, equating to 3.5% of its workforce.
As of the end of the fourth quarter of 2023, Macy’s operated 718 stores.
Macy’s CEO Tony Spring said: “A Bold New Chapter serves as a strong call to action. It challenges the status quo to create a more modern Macy’s.
“We are making the necessary moves to re-invigorate relationships with our customers through improved shopping experiences, relevant assortments and compelling value. Our teams are energised by the work ahead as we accelerate our path to market share gains, sustainable, profitable growth and value creation for our shareholders.”
In the full year 2023, Macy’s reported net sales of $23.1bn, down 5.5% from 2022.
The retailer’s digital and bricks-and-mortar store sales decreased 7% and 5% respectively in the fiscal year 2023 (FY23) compared to the previous year.
Its diluted earnings per share (EPS) also dropped to $0.38 in FY 2023 from $4.19 the previous year.
In its 2024 guidance on a 52-week basis, the company expects net sales between $22.2bn and $22.9bn and an adjusted diluted EPS range of $2.45 to $2.85.
