The job cuts and store closures come as Macy’s sales continued to slide during the critical holiday season.
Macy’s Inc. still plans to close one-fifth of its stores or roughly 125 locations over the next couple years and also will open smaller, freestanding stores, officials said Wednesday.
But the timeline for the store closings could be adjusted as Macy’s monitors the competition and recovery from the impact of the coronavirus pandemic, Macy’s CEO Jeff Gennette said Wednesday during the retailer’s quarterly earnings call with analysts.
“Retail today has been disrupted. And while that disruption creates challenges, it also holds opportunity,” Gennette said. “With many competitors closing or struggling, we see the potential to bring new customers into our brands and gain market share.”
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J.C. Penney, Lord + Taylor and Neiman Marcus are among the department store chains that have filed for bankruptcy and announced store closures. Lord + Taylor announced Aug. 27 that is closing all of its 38 stores.
During a court hearing this week, a lawyer for J.C. Penney said negotiations to sell the retailer to one of the largest mall owners in the country or other investors have stalled, placing the retailer on the edge of a potential liquidation of the entire chain.
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Macy’s announced in February that it planned to cut 2,000 jobs and close 125 stores over the next three years. Macy’s had said it planned to save $1.5 billion by year-end 2022, but Gennette said Wednesday that the target savings was now $2.1 billion.
The company’s first round of closures, announced in January, included locations in 19 states from California to Florida and as far west as Hawaii. One Bloomingdale’s store in Florida also closed.
Macy’s has not disclosed which stores will be shut down in future rounds of closures in the three-year window.
“We continue to believe that the best malls in the country will thrive. However, we also know that Macy’s and Bloomingdale’s have high potential off-mall and in smaller formats,” Gennette said Wednesday. “We are monitoring the competition and both store and mall performance closely, and we will adjust our timeline that needed.”
Among the new, smaller stores, Gennette said the company plans to look at opening several freestanding Backstage off-price outlet stores, testing Backstage online sales, and continuing the expansion of Bloomingdale’s outlet stores. Also expanding: the Backstage store-within-a-store concept.
Contributing: Nathan Bomey
Follow USA TODAY reporter Kelly Tyko on Twitter: @KellyTyko
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