Recently, American department store chain Macy's announced plans to lay off 3.5% of its workforce and close five stores to reduce operating costs.
The company is scheduled to lay off 2350 employees starting from January 26th, involving various positions in offices and stores.
The 5 stores planned to be closed are located in Virginia, California (2), Hawaii, and Florida. According to company spokesperson Chris Grams, the closure will take place at the beginning of this year.
The US Department of Commerce recently stated that the US public increased retail consumption in December last year. But even so, Macy's still couldn't escape the curse of retailers always laying off employees after holidays.
The management also stated that the company will announce a broader strategic plan in the near future.
In a memo sent to employees, the company mentioned transferring certain areas of business overseas, but did not provide specific details.
Macy's Department Store is a well-known large chain retailer in the United States, headquartered in New York City and established for nearly 166 years. In addition to the store with the same name, the company also has a beauty and skincare store called Blue Mercury and a high-end department store called Bloomingdale.
At the beginning of next month, the CEO of Macy's department store will be Tony Spring, the CEO of its Bloomingdale department store. As the new CEO, Spring is committed to reducing promotional expenses and increasing profits to help the company recover from the excess inventory in 2022.
Over the past year, Macy's has been facing sales pressure due to a decrease in consumer spending on clothing and non essential items. Last December, an investment group also proposed the idea of privatizing the company for $5.8 billion.
In recent years, Macy's performance has been impacted by the rapid development of e-commerce, the COVID-19, and its business scale has been shrinking.
In this context, this well-known department store has begun a transformation, hoping to resonate with consumers.
The memo states that the decision to lay off employees and close stores is aimed at responding to the constantly changing needs of consumers and the market, with the aim of improving cost structure and enhancing competitiveness.
Compared to in store sales, Macy's has shifted its focus to consumers who enjoy online shopping, while also learning from the sales models of its competitors, Amazon, and large retailer Target.
In addition, Macy's department store plans to expand its business to the suburbs and open more small stores outside the department store.
At present, the company operates over 700 stores. Compared to its peak of $73 per share in 2015, Macy's stock price has fallen by 75%, and the company has closed nearly 300 stores.