Why Macy’s Is Closing Even Profitable Stores
It’s no secret that department stores are having a rough time these days. Comparable sales over the holiday season fell at nearly every major chain, and total sales at department stores dropped 5.6% last year, according to the Census Bureau. Macy’s may be the poster child for this declining industry. The company is more than 100 years old, and has flagship stores in the downtown of major cities across the country. It’s as synonymous with shopping as any other store. It has, however, posted declining comparable sales for the last seven quarters in a row, and is on its way to its eighth straight drop. Like its peers, Macy’s has been squeezed by e-commerce competitors like Amazon.com on one side and by fast-fashion purveyors like H&M and Uniqlo on the other. As part of its restructuring strategy, Macy’s announced last year that it would shut down 100 stores, and recently named 68 of them, saying it would lay off 10,000 employees in the process. But incoming CEO Jeff Gennette revealed an interesting fact about the store closures when he said that the stores the company is closing are still profitable. Read more at The Motley Fool.
