NEW YORK–(BUSINESS WIRE)– Macy’s, Inc. (NYSE: M) today announced an updated strategy and three-year plan designed to stabilize profitability and position the company for growth.
“We have a clear vision of where Macy’s, Inc. and our brands, Macy’s, Bloomingdale’s and Bluemercury, fit into retail today. We are confident in our Polaris strategy, and we have the resources required to return Macy’s, Inc. to sustainable, profitable growth,” said Jeff Gennette, chairman and chief executive officer of Macy’s, Inc. “We will focus our resources on the healthy parts of our business, directly address the unhealthy parts of the business and explore new revenue streams. Over the past three years, we have shown we can grow the top-line; however, we have significant work to do to improve the bottom-line. We are confident the strategy we are announcing today will allow us to stabilize margin in 2020 and set the foundation for sustainable, profitable growth.”
“We are taking the organization through significant structural change to lower costs, bring teams closer together and reduce duplicative work. This will be a tough week for our team as we say goodbye to great colleagues and good friends. The changes we are making are deep and impact every area of the business, but they are necessary. I know we will come out of this transition stronger, more agile and better fit to compete in today’s retail environment,” continued Gennette.
The company completed a rigorous evaluation of Macy’s store portfolio. This included a store-level assessment of each store’s overall value. As a result, Macy’s plans to close approximately 125 of its least productive stores in lower-tier malls over the next three years, including approximately 30 stores that are in the process of closure now. These approximately 125 stores currently account for approximately $1.4 billion in annual sales.
The company also plans to invest more in its websites and mobile apps.
In addition, Macy’s, Inc. is streamlining its organization with a net reduction in its corporate and support function headcount of 9%, or approximately 2,000 positions.
The company is also testing a new store format, Market by Macy’s. This new format is smaller than an average Macy’s store and will be located off-mall in lifestyle centers. Market by Macy’s will feature a mix of curated Macy’s merchandise and local goods, as well as local food and beverage options and a robust community events calendar. The company will open its first Market by Macy’s in Dallas on February 6, 2020.