Macy’s on Monday named a new president and announced a new merchandising strategy and a reduced headcount.
The company has restructured its merchandising efforts, folding merchandising, planning and private brands into one function, which will focus on five “families-of-business”: ready to wear, center core, beauty, men’s and kid’s, and home. Additionally, to make the team more efficient, Macy’s is strengthening its customer insights and data analytics with inventory replenishment and pricing capabilities.
The changes will result in about 100 job cuts. Macy’s anticipates the restructuring will save about $30 million annually and about $5 million in the fourth quarter of 2017. One time costs are expected to be between $20 and $25 million, which will be booked in the third quarter.
“The changes we are making today maintain our core merchandising skills while massively simplifying our structure and processes for greater speed and flexibility. We are also further strengthening our consumer insights and data analytics capabilities so we can make better decisions faster, balancing the art and science of retail,” said CEO Jeff Gennette in a statement.
Gennette said the development will help the department store achieve its plan to grow private and exclusive collections to 40 percent of the business, which the company has targeted to 2020. That plan, which was outlined during Macy’s investor meeting in June, is designed to boost inventory turns, improve full-price sell throughs and increase target average unit retail.
[Read more about Macy’s plans for product, marketing and experiences: Macy’s New Strategy Overshadowed by Full Year Guidance Update]
The new team will be lead by Jeff Kantor, currently Macy’s chief stores and human resources officer. Kantor has 35 years with the company, including roles as chairman and president for merchandising for macys.com.
Kantor will report to Hal Lawton, who will take the reins as president of Macy’s on Sept. 8. Lawton’s purview will cover merchandising, marketing, stores, operations, technology and consumer insights and analytics. Most recently, he was SVP of eBay North America. Prior to that, he was at Home Depot for 10 years where he was instrumental in launching the company’s $2 billion online business. Lawton will report to Gennette.
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“This is a key step as we look to further transform the business and work through the volatility of today’s retail landscape,” Gennette said. “Macy’s already has one of the strongest omnichannel businesses in the industry, and with Hal on the team, we will accelerate the integration of digital both online and in our stores to deliver the world-class experience our customers demand.”