Many people in the U.S. know that many stores across the country are having a hard time. Malls and the shops inside them are both being hurt by the economic downturn.
A lot of big stores, like The Body Shop, Express, Rue21, Bath & Body Works, and Foot Locker, have had to close down or even go bankrupt. Now, another big name in shopping is about to do the same thing.
Details about Macy’s closures
Macy’s has said that 150 of its stores will be closed in the next few months. The company has split its stores into two groups: “go forward” stores and “non-go forward” stores. Macy’s is going to put money into new items and changes for the stores that are marked “go forward.” The stores that are marked “non-go forward” are going to close.
During a recent earnings call, CEO Tony Spring talked about why this choice was made. “Just to remind you, in fiscal year 2023, Macy’s go-forward locations had better comp sales than non-go-forward locations by about 500 basis points, and the four-wall adjusted EBITDA rate did better by about 950 basis points.”
Even though non-go-forward locations don’t do as well as the rest of Macy’s stores, they are still important real estate assets. There is a lot of interest in these homes.
The closing of these Macy’s stores will have big effects on shopping malls and customers alike. Know this:
- Impact on Malls: As one of the major anchors in many malls, Macy’s closures could lead to decreased foot traffic and revenue for the remaining stores.
- Real Estate Opportunities: Despite the closures, the real estate assets are valuable, and there is strong demand for these properties. This could lead to new opportunities and developments in these spaces.
- Shopping Experience: Shoppers may need to adjust to the changing landscape of their local malls and seek alternative locations for their favorite brands.
These changes show how important it is to be flexible and come up with new ideas as the retail industry continues to change. In a market that is always changing, malls and stores need to come up with new ways to get and keep people.
Fifty-five shops will close by the end of the year, and the rest will follow soon after. But the exact places that will be impacted have not been announced yet.
Understanding the Changes
As for why these stores were closing, Spring said, “Our customers have become more selective, which we attribute to ongoing macroeconomic uncertainty and an increasingly complex news cycle.” The company has made a number of strategy changes to keep up with the changing business environment.
Adapting to New Customer Preferences
Spring elaborated on the adjustments being made: “We aligned our assortments and shifted our marketing calendar to better balance value and fashion. We enhanced our promotions and delivered more targeted, personalized messages across categories and brands. Additionally, we invested in newness and proven areas of product strength while reducing our exposure to areas of softer demand.
Macy’s Presence Nationwide
There are 519 Macy’s stores in the United States right now. Besides these, the company also owns more than 150 Blue mercury shops and 56 Bloomingdale’s stores.
Even though things are tough right now, Macy’s is still focused on meeting customer wants and staying ahead in the retail world, which is always changing.