Macy’s to close stores, cut jobs amid weak sales
ASSOCIATED PRESS
Macy’s says it is eliminating more than 10,000 jobs and plans to move forward with 68 store closures after a disappointing holiday shopping season. The department store chain also lowered its full-year earnings forecast.
Macy’s says it is eliminating more than 10,000 jobs and plans to move forward with 68 store closures after a disappointing holiday shopping season. The department store chain also lowered its full-year earnings forecast.
The retailer said Wednesday that sales at its established stores fell 2.1 percent in November and December compared to the same period last year. Macy’s Inc. pointed to changing consumer behavior and said its performance reflects the challenges that are facing much of the retail industry.
(No Hawaii stores were on the list of stores to be closed this year. A pop-up Macy’s jewelry store at Ala Moana Center closed last year. The main Ala Moana Macy’s is not on the list of stores closing.)
The company said the 68 store closures, which span the nation, are part of the 100 closings it announced in August. Of the 68, three were closed by the middle of 2016, 63 will close in the spring and two will be closed by the middle of 2017.
Macy’s is selling or has sold three other locations, but is leasing the properties back and will keep operating those stores.
Some employees may be offered positions at nearby stores, but Macy’s estimates that 3,900 employees will be affected by the closures.
Macy’s also said it plans to restructure parts of its business and sell some properties. This will lead to the reduction of 6,200 jobs. The moves are estimated to save $550 million annually.
Overall, Macy’s said, the job reductions represent about 7 percent of its workforce.
The company, which owns the Macy’s and Bloomingdale’s brands, has been struggling with declining traffic in its stores, where the bulk of its business is still conducted. It said it is closing stores that are “unproductive or are no longer robust shopping destinations” as well as selling those with highly valued real estate.
It plans to invest some of its savings in growing its digital business.
Macy’s said it now expects to earn between $2.95 and $3.10 per share on an adjusted basis for its 2016 fiscal year, versus its prior forecast of $3.15 to $3.40 per share. The company is scheduled to report full results in February.
Shares in Macy’s fell more than 10 percent to $32.20 in after-hours trading.
28 responses to “Macy’s to close stores, cut jobs amid weak sales”
Leave a Reply
You must be logged in to post a comment.
Change the name back to Liberty House.
What Macy’s didn’t say is they reevaluated their labor costs in states/cities where laws were passed to raise the minimum wage. Stores realize the extra costs cut into their profits, can’t raise prices higher all the time.
Better to just call it quits in those areas while you can, move on
Check out the carnage behind fight for 15. http://www.facesof15.com/
The group behind that web site has been falsifying data for years, and their “research” has been debunked over and over again. They are funded entirely by low wage industries like hospitality and tobacco.
Have you done any research at all on them?
klastri – Didn’t see one credible link to back up your claims.
Ohhh yes. Unlike you I do my due diligence. Go to the website I posted, check out the report of Ashley furniture leaving California.
Here is the link from the San Bernadino The Sun News Paper validating this post. Yes, Ashley is leaving California. http://www.sbsun.com/business/20160826/hundreds-laid-off-at-ashley-furniture-factorywarehouse-in-colton
No need to thank me for educating you. It’s what I do.
Localguy — Macy’s, Sears, Kmart says sale are down, that’s why they are closing non-performing stores. Did any of them say they are closing stores because labor costs are going up? Have you been to the mainland and seen some of the older malls?
Localguy: Followed your link to story in The Sun, and it made no mention of minimum wage. Thanks for the education.
ghstar – When sales go down, labor, energy usage costs go up, it is a double hit to the stores. Knowing labor costs will continue to increase, it is usually easier to shut the store down if it can’t be reduced in size.
Understand Macy’s is usually an anchor store in the larger, more upscale malls in better areas. You are talking about the smaller, less upscale malls, in somewhat declining areas, a major difference.
And yes, I have traveled through Washington, California, New Mexico, Las Vegas and seen good and not so good malls. I never saw a Macy’s in a low class mall.
In store sales are down around the USA due to the internet. I do all my holiday shopping either online or at Costco and Walmart. I did buy online from Sears, hardware item as Craftsman Tools are a quality product. Same for Kenmore appliances, I have one, well rated by Consumer Reports.
Macy’s, Sears, Kmart, JCPenney to name the worst are closing unprofitable stores and leaving some of the older malls without anchors. This has little to do with the minimum wage laws in some states. Run down malls in now unsafe neighborhoods and unprofitable stores are going away for many reasons, on-line shopping and more dynamic retailers like Target, Costco, Lowes, and Best Buy are simply offering better prices and good service. Sears, Kmart and probably Penneys will be gone in 5 years, minimum wage or not.
No true. Wages has everything to do with it. Had you done your research you would learn very few of the malls could be considered run down.
Check out my latest post above. Companies factor in the cost of employee compensation, sales, leasing, all the costs of doing business.
Labor goes up, time to rethink operations.
Yes, the internet sales are a change in operations and several $15/hour jobs saved by only operating an internet, automated warehouse shipping facility.
Now, why would Macy’s do that? It will likely hurt their sales more.
Changing the name will not change the management and products, even though there is a lot of similarity.
I read about the plans for the Kailua Liberty-House/Macy’s.
Part of the reason for the Macy’s close was the expiry of the land lease.
It looks like the owner/primary lease holders will try to retain the character of the place, while transitioning to some thing more viable
This may be the closest we could come to retaining the Liberty House name which I recall is still on the building in one or more places.
I miss the old Liberty House store, I hope that they can do this.
Liberty House was the best. Great service and treating customers (and employees) right is what made them an institution in Hawaii. Free alterations, free gift wrapping, “no questions asked” return policy. Always had a gift box and tissue at the register if you were in a hurry. 33 1/3% discount for employees. Would always call another store if they didn’t have something you were looking for and have it brought to their store for easy pick up. Unheard of these days. I bet some of you still have that gift box with the blue flower on it? But I guess those days are gone.
Sign of the times. Probably other stores will follow.
Amazon, simply explained.
Internet and delivery system improvements have made large department stores irreverent for many millennials as well as seniors conversant withe internet. Amazon improved their delivery system and as a consequence received my package the very next day to my door step. Beats fighting traffic and hobbling to the shop.
You must have paid for “one day delivery” to get it “the very next day to my door step”. And, that service is very expensive.
If you have Amazon Prime you get access to all their videos, other perks. Free/fast shipping is just part of the deal.
Agree. I spent half my Christmas budget online at Amazon, and the other have at … guess what….. mostly Macy’s during their sales on surf shorts among other things.
If Macy’s had to close another store on Oahu, which one would it be: Waikiki, Windward Mall or Kahala Mall?
All three. They will become stores with foreign companies.
Waikiki would be the least likely to get shut down due to heavy exposure to tourists from Asia unless the expenses to maintain that location are too prohibitive to keep around.
Macy’s is slow because the store no longer carries good merchandise. For instance the store sells lots of Martha Stewart kitchen and bath products which was orginally sold at K Mart. Macy’s use to sell good quality merchandise, now it is a sale everyday with merchandise similar to Walmart. The clothes, even with big designer names are poorly made. I used to buy all my gifts from Macy’s, but this year I spent less than $100 there. Macy’s need more made in America products. My old ten years old clothes are better than the stuff that is now sold at Macy’s.
Love Macy’s! Will continue to support and patronize Ala Moana and PearlRidge stores. They have the nicest sales people ! Happy to hear none of these branches are closing!
Never cared for Macy’s (Honolulu) store… Bring Liberty House back!!
Hate shopping at a store that requires clipping coupons, figuring out how to use an app, special credit cards, loyalty cards and all kinds of gimmicks to get a sale price. Who has time for all of that? Forget it. Amazon.com is just as affordable and infinitely more convenient. I much refer honest pricing over artificially inflated, then gimmicky discounted prices.
I think Macy’s underestimated the decision to get political.. with opposing Trump… The old rule of staying out of Politics .. Trump has the last laugh.