Macy’s to close 100 stores in 2017

Staff/wire report

YOUNGSTOWN

Cincinnati-based Macy’s announced Thursday that it plans to close 100 full-line stores early next year out of its 675 full-line stores.

Locations of those stores will be announced at a later date, the company said.

“Nearly all of the stores to be closed are cash-flow positive today, but their volume and profitability in most cases have been declining steadily in recent years,” said Jeff Gennette, Macy’s Inc. president, in a release. “We recognize that these locations do not yield an adequate return on investment and often do not represent a customer shopping experience that reflects our aspirations for the Macy’s brand.”

For its stores that will stay in business, Macy’s said it will invest in improvements. The retailer will add new vendor shops, increase the size and quality of staff, integrate new technology and create a new experience for the customer.

Macy’s has been looking for opportunities to boost sales, from buying upscale beauty brand Bluemercury to launching its own off-price stores called Macy’s Backstage. But since this past May, it announced it has to accelerate its efforts to get shoppers excited.

Together, the annual sales volume of the 100 locations to be closed is expected to be about $1 billion.

The company said it will first communicate its store closing decisions directly with the employees of those respective stores before a public announcement is made.

Associates displaced by store closings may be offered positions in nearby stores where possible. Eligible full-time and part-time associates who are laid off due to the store closing will be offered severance benefits.

This past spring, the retailer closed 40 other stores.

On the same day Macy’s announced its plan to “drive profitable growth,” the retailer announced another quarter of sales and profit loss.

Sales in the second quarter totaled $5.866 billion, a decrease of 3.9 percent, compared with sales of $6.104 billion in the same period last year.

The company posted earnings of $11 million, or 3 cents per share, compared with $217 million, or 64 cents, made in the second quarter of 2015 because of the cost associated with store closings.

Excluding those costs, the company’s earnings were 51 cents per share in the second quarter.