MACY’S, HBC BOTH EXPANDING IN-STORE OFF-PRICE CONCEPTS

by John Russel Jones May 23, 2023

The store-within-store off-price concept seems to be an idea that’s – well – not to be discounted. Macy’s recently announced that it is adding 10 new locations for Macy’s Backstage, throughout the country this spring, while Canada’s Hudson’s Bay has announced the expansion of its Zellers stores – tucked within Hudson’s Bay department stores — to 25 locations across Canada this year.

The new Macy’s Backstage locations span from 11,000 to 23,000 square feet and with a product mix that includes young women’s, sportswear, dresses, luxury handbags, and men’s apparel. The store strategy is aimed at attracting new shoppers by offering a curated selection of merchandise ordered in smaller quantities and more frequently, for a rotating assortment that guarantees a fresh and exciting shopping experience.

Macy’s at Francis Scott Key Mall celebrates the grand opening of Macy’s Backstage Saturday, May 13, 2023 in Frederick, MD. (Eric Kayne/AP Images for Macy’s, Inc.)

The new locations will open starting this month through July 2023, and include Macy’s Francis Scott Key Mall, in Frederick, Md., Bellevue Square, in Bellevue, Wash., Orland Square, Orland Park, Ill., Firewheel Town Center, Garland, Texas., Macy’s Mall at Robinson, in Pittsburgh, Penna., and Southland, in Cutler Bay, Fla., among others, with the concept being found in more than 300 locations across the department store chain.

Our (off-price) neighbors to the North

Zellers was a Canadian discount chain, established in 1931, which was bought by HBC in 1978. The brand was relaunched as an in-store pop-up at The Bay in 2021. The company intends to open larger footprint stores in some or all of those same locations. The first pop-up will launch at Hudson’s Bay’s flagship Queen Street store in Toronto, Ontario, Canada, in June, with up to an additional 20 pop-ups expected to open in August. Zellers focus is on everyday low prices, and includes a product assortment built on quality, design, and value. Lifestyle categories include kitchen and bath, accent furniture and home decor, organization and storage, baby and kid’s toys and apparel, pets, and apparel basics for men and women.

“We have always said that we will listen to Canadians, and they will tell us where to grow,” says Sophia Hwang-Judiesch, President, Hudson’s Bay. “With these pop-ups, our expansion strategy will be fueled by the interest and feedback from our customers across the country.”

HBC, the holding company of investments and businesses that include Hudson’s Bay and Zellers, as well as Saks Fifth Avenue and Saks Off Fifth, announces today that it has raised $240MM of additional liquidity to further invest in and grow its operating businesses. With an immense opportunity for growth in its retail markets, HBC recognizes that this capital will strengthen the company’s strategic position while also taking advantage of the opportunities being created as other retailers exit the Canadian market.

“As we diversify our consumer offerings, we are strongly positioned to expand on the retail experience customers have come to expect from Hudson’s Bay, Saks Fifth Avenue, Saks Off Fifth and now Zellers,” says Richard Baker, Governor, Executive Chairman and CEO of HBC. “With this incremental liquidity, we will strengthen our businesses and build upon the great foundation we have established.”