It’s widely known that numerous malls nationwide are struggling, which consequently impacts the stores within them, leading many to close their locations or even file for bankruptcy. Among the retailers shutting down stores are popular names such as Foot Locker, Bath & Body Works, The Body Shop, Rue21, and Express, and now, a significant anchor store found in many malls will also be adding to this list.
Macy’s is set to shut down 150 stores in the upcoming months. The company has categorized its locations into “go forward” and “non-go forward” stores, intending to channel investments into new merchandise for the former group, while the latter will face closures. In a recent earnings call, CEO Tony Spring noted, “As a reminder, in fiscal 2023, comp sales of Macy’s go-forward locations outperformed non-go-forward locations by approximately 500 basis points and the four-wall adjusted EBITDA rate outperformed by roughly 950 basis points. Although the non-go-forward locations are lagging behind the overall Macy’s portfolio, they hold significant value as real estate assets. There has been considerable demand for these properties.
According KFI, out of those stores, 55 are set to close by the year’s end, with the remaining locations following suit shortly thereafter. The specific sites that will be impacted have not yet been disclosed.
Regarding the reasons behind this shift, Spring speculated, “Our customer has become more selective, which we link to persistent macroeconomic instability and a more intricate news environment.” He continued by explaining that they are implementing adjustments to navigate the evolving situation, declaring, “We have realigned our assortments and modified our marketing timeline to achieve a better equilibrium between value and style. We improved our promotional efforts and provided more tailored, personalized communications across various categories and brands. Additionally, we focused on introducing new products and reinforcing established areas of strength while minimizing our involvement in segments with weaker demand.
At present, there are 519 Macy’s locations across the nation, in addition to more than 150 Bluemercury shops and 56 Bloomingdale’s outlets owned by the company.
