Macy’s to close 35 to 40 stores

Cincinnati -- The ax fell at Macy’s on Tuesday.



In the name of optimizing its omnichannel approach, Macy's said it plans to close between 35 and 40 namesake stores in early 2016 even as its moves ahead with expansion of its new off price format, Macy’s Backstage.



The stores to be closed represent about 1% of Macy’s total annual sales of roughly $28 billion. Macy’s said it won’t disclose the locations it completes a careful analysis now under way to make final decisions and notifies store employees. Together, the stores' annual sales volume, net of sales expected to be retained in nearby stores and online, is expected to be roughly $300 million.



"Physical stores remain absolutely vital to our omnichannel strategy, which provides local touch-points and tailored merchandise assortments for shoppers in nearly every major market," said Terry J. Lundgren, Macy's, Inc. chairman and CEO. "As new shopping centers are opened, however, many customers change their shopping habits and often the sales volume of a store gets divided among the new and nearby, existing centers. Each year, we prune some stores that are our weakest performers so that we can concentrate our resources on the best locations and maintain a strong physical presence. At the same time, we open a small number of new stores to fill gaps in our market coverage or where we have outstanding real estate opportunities."



Since 2010, Macy’s has closed 52 namesake stores and opened 12 new ones. Lately, the company’s new off price recently made its debut, with plans to open six locations this fall.



In making the announcement about the closings, Lundgren stressed the company’s extended omnichannel offerings.



"Macy's is already one of the largest and fastest-growing digital platforms in the country,” he said. “Our fast-growing digital offering, including robust apps and mobile-enhanced websites, integrate with our stores to provide an unparalleled omnichannel shopping experience for customers wherever, whenever and however they prefer to shop. As a result, we are able to attract new customers and grow sales profitably.”