Macy’s announced plans Tuesday to close 35 to 40 underperforming stores in early 2016 as it improves its omnichannel approach.
The store closures, which will represent approximately 1 percent of total Macy’s stores, are part of the company’s strategy to stay competitive as consumers split their purchases across physical stores and online.
“Physical stores remain absolutely vital to our omnichannel strategy, which provides local touchpoints and tailored merchandise assortments for shoppers in nearly every major market. As new shopping centers are opened, however, many customers change their shopping habits and often the sales volume of a store gets divided among the new and nearby, existing centers,” said Terry Lundgren, Macy’s, Inc. chairman and chief executive officer, in a statement.
He added, “Each year, we prune some stores that are our weakest performers so that we can concentrate our resources on the best locations and maintain a strong physical presence. At the same time, we open a small number of new stores to fill gaps in our market coverage or where we have outstanding real estate opportunities.”
The locations to be closed will be announced at a later date. Combined, the stores’ annual sales volume and the net of sales expected to be retained in nearby stores and online, is expected to be approximately $300 million. Sales associates displaced by store closings may be offered positions in nearby locations where possible. Eligible full-time and part-time associates who are laid off due to the store closing will be offered severance benefits.
Macy’s, Inc. operates 770 Macy’s stores. Over the past five years, the company has closed 52 locations and opened 12 new Macy’s stores. This fall, the retailer is opening six new Macy’s Backstage off-price locations, offering consumers another alternative to shop the Macy’s brand.