The well-known department store chain Macy’s announced the closure of 65 stores in the coming weeks, accelerating a restructuring plan that seeks to address the challenges of the current retail market. This move comes at a crucial time, just before the holiday season, that reflects the urgency to adjust its operating model.
The closure of these branches is part of a strategy to reduce costs and focus on more profitable operations. Although Macy’s has not detailed which stores will be closed, this news is causing concern among employees and regular customers of the chain.
Currently, Macy’s operates just over 400 stores, but after this cutback it will be down to around 350, significantly less than the more than 1,100 stores it operated in 2008.
Macy’s: Declining Sales and Internal Problems
The company faces a number of challenges, such as a 2.4% drop in quarterly sales and a financial scandal that revealed $150 million in hidden expenses, which negatively impacted its earnings projections. Added to this is fierce competition from e-commerce giants, as well as the decline of shopping malls, which have become less attractive to consumers.
With Tony Spring recently taking over as CEO, the company has redoubled efforts to implement a turnaround program. Although challenges persist, Spring assures that Macy’s is working to turn its situation around.
A Challenge Shared by the Retail Sector
Store closures are not unique to Macy’s. In the first months of 2024, close to 2,600 stores in the United States closed their doors, affecting chains such as Walgreens and Big Lots. This phenomenon, known as the “retail apocalypse,” reflects the difficulties faced by the sector in the midst of changing consumer habits.
Despite the adversities, Macy’s is seeking to adapt to the changes in the market while trying to maintain its relevance as one of the leading department store chains in the country.
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