Macy’s will reportedly close four locations, in Fort Collins, Colo.; Gaitherbeurg, Md.; Kanohe, Hawaii; and Los Angeles in January 2023, according to USA Today and other media outlets. The closures are part of the retailer’s Polaris growth strategy, which aims to stabilize the department store as it pursues a return to growth. The company will offer impacted employees jobs at nearby locations or severance packages.
The Polaris strategy, which involves a combination of customer, operations and store footprint-based initiatives, has had mixed success. The retailer has managed to achieve profitability in some quarters, but its overall sales growth has been negative and its outlook for the coming year remains cautious.
“Based on current macroeconomic indicators and our proprietary credit card data, we believe the consumer will continue to be pressured in 2023, particularly in the first half, and have planned inventory mix and depth of initial buys accordingly,” said Jeff Gennette, Chairman and CEO of Macy’s in an update on Q4 2022 expectations. “We take a balanced approach to merchandise receipts and remain committed to offering fashion and value across nameplates and channels, with the capacity to adjust in-season buys and chase into areas of strength. As we look further ahead, the efficiencies we’ve built into our business coupled with our financial health, data-driven decision processes and agile ways of working, allow us to operate from a position of strength while continuing to invest in our future.”
All four shuttered stores were on-mall locations. Macy’s made strides in opening smaller, off-mall locations in 2022 with the addition of four new Market by Macy’s stores, bringing the total to eight. These shops, located closer to customers, can serve as omnichannel hubs. The retailer also expanded its off-price Macy’s Backstage concept with another 42 locations, including five standalones, bringing the total to more than 300 at the end of 2023.
Macy’s has decline to spin off its ecommerce operations, claiming the move has “high execution risk,” and the retailer is making investments in its omnichannel offerings. Among the latest is a partnership with FIT:MATCH that added the solution provider’s body-scanning bra fitting experience to 10 retail locations.