Macy's To Close 50 Stores In FY24
Macy’s unveiled a three-pronged approach to reinvigorate the venerable department store, which includes closing 150 stores over the next two years, with 50 of those locations expected to close by the end of the current fiscal year.
According to the retailer, its effort to strengthen the Macy’s nameplate will include the aforementioned store closures along with investments in some 350 stores and the continued expansion of small-store formats.
Macy’s said it plans to revitalize its assortment to improve relevance and value; modernizing the shopping environment to facilitate a convenient, easy, and frictionless customer experience across channels with continued focus on digital excellence; and the store closures and investment in those locations that will remain open.
Calling the initiative “A Bold New Chapter,” the plan was developed by Macy’s leadership team with support of its board of directors.
“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."
— Tony Spring, Macy's
“A Bold New Chapter serves as a strong call to action. It challenges the status quo to create a more modern Macy’s, Inc.,” said Tony Spring, Macy’s CEO. “We are making the necessary moves to reinvigorate relationships with our customers through improved shopping experiences, relevant assortments and compelling value. 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.”
The plan also includes an effort to accelerate luxury growth where the retailer will utilize its Bloomingdale’s and Bluemercury nameplates. As part of the strategy, approximately 15 Bloomingdale’s nameplate stores and at least 30 new Bluemercury stores, along with roughly 30 Bluemercury remodels are anticipated to be opened in new and existing markets over the next three years.
Additionally, Macy’s said it plans to simplify and modernize end-to-end operations. Over the next three years, the organization plans to rationalize and monetize the supply chain asset portfolio, streamline fulfillment, improve inventory planning and allocation, and deliver a scalable technology platform. Across the organization, Macy’s plans to align operations to anticipated future omni-demand and deliver a more efficient operating model that will allow the organization to better serve customers.
The unveiling of its “Bold New Chapter” comes the same day the retailer reported fourth quarter net sales of $8.1 billion, a decrease of 1.7% when compared to the fourth quarter of 2022. Brick and mortar sales were flat year-over-year while digital sales were down 4% versus the comparable quarter the previous year. Comparable sales, on a 13-week basis, were down 5.4% on an owned basis and down 4.2% on an owned-plus-licensed basis.
The Macy’s nameplate saw strength in beauty, particularly fragrances and prestige cosmetics, and its Backstage off-price business while women’s shoes saw continued softness along with relatively weaker performance in cold-weather apparel and accessories.
For the full fiscal year, Macy’s reported net sales of $23.1 billion, down 5.5% from the prior fiscal year. Brick and mortar sales in the quarter were down 5% and digital sales were off 7%. Comparable sales, on a 52-week basis, were down 6.9% on an owned basis and down 6.0% on an owned-plus-licensed basis versus 2022.
