NEW YORK, N.Y. – Macy’s plans to restructure its merchandising and marketing operations in response to changes in the way customers shop in stores and online.
It says it’s even contemplating an off-price business that would be similar to a TJ Maxx.
The retailer said Thursday it will also close 14 department stores but open two new locations, resulting in annual savings of roughly $140 million. Macy’s says it plans to reinvest those savings into its business.
It says its overall workforce of about 175,000 will remain level as it lays off about 2,200 workers nationwide but picks up staffing in other areas. For example, Macy’s is expected to expand its San Francisco online division by hiring more than 150 workers.
Macy’s has been a standout among its peers throughout the economic recovery and has reaped the benefits of its strategy of tailoring merchandise to local markets. But like other chains, it’s grappling with a still cautious consumer. And it’s also trying to respond to the fact that shoppers more often are buying and researching before shopping on their computers, smartphones and tablets.
Macy’s has been embracing new services for shoppers looking for more convenience. Last fall, it began testing same-day delivery of products purchased at Macy’s.com and Bloomingdales.com in eight major U.S. markets. It also offers shoppers the opportunity to order online and pick up the merchandise at the stores. It’s also launched new mobile shopping aps heading into the holiday season.
“We must continue to invest in our business to focus on where the customer is headed — to prepare for what’s next,” said Terry J. Lundgren, Macy’s chairman and CEO in a statement.
Macy’s said that it aims to increase the number of its outlet stores but is also looking to explore potential opportunities for an off-price business. The company said that exploration is in its early stages. As part of its restructuring, Macy’s plans to have one group buy and market merchandise for both its stores and its online business. The same will be true at its upscale Bloomingdale’s chain.
Separately, the Cincinnati company, which operates more than 800 stores, says a key sales metric rose 2.7 per cent during November and December, in line with its expectations.
Macy’s Inc. says it is backing its expectations for fourth-quarter earnings per share, excluding restructuring costs.
The company’s stock slid more than 3 per cent in after-hours trading.