Macy’s Inc. plans to close 28 stores, though holiday results came in better than expected. The department store company is set to reveal a three-year strategy for growth that includes pruning its store fleet, in addition to layoffs at Bloomingdale’s.
November and December comparable sales at Macy’s dipped just 0.6 percent, a decent result given the difficult department store sector.
Since Thanksgiving and the Black Friday and holiday weekend, mall traffic was seen as being far slower than in years past, according to retail consultants. While they attributed part of that to a rise in online sales, there’s also been concern that the slowdown meant retailers wouldn’t be grabbing the impulse buys that consumers pick up when browsing stores–all of which provide a huge margin boost to their bottom lines.
Recent traffic data indicates that the best week in December was the one ended Dec. 27, which saw sales up just 0.1 percent. The first, second and third weeks of the month saw sales slip 3.9 percent, 9.0 percent and 10.7 percent, respectively, per a roundup from Cowen & Co.
Macy’s holiday sales seems to have received a boost from the rise in e-commerce.
“Macy’s Inc.’s performance during the holiday season reflected a strong trend improvement from the third quarter,” Jeff Gennette, chairman and CEO, said. “Our digital business and Growth150 stores performed well. Additionally, customers responded to our gifting assortment and marketing strategy, particularly in the 10 days before Christmas.”
The retailer will host an Investor Day meeting with analysts in New York on Feb. 5, when management is expected to provide details of the company’s growth plans and its new three-year strategy.
The last one, in June 2017, detailed its North Star strategy for its best stores, as well as a concerted focus on mobile.
So far for 2020, the retailer plans to close one Bloomingdale’s store in addition to the 28 Macy’s doors. “We regularly review our store portfolio,” a Macy’s spokeswoman said of the decision to shutter doors.
Macy’s Bloomingdale’s operation is also reported to be undergoing a restructuring, which will result in a number of jobs cut in the process.