Macy’s to close five mall stores, cut 2,350 jobs

Macy’s, Inc. is looking to become a “more streamlined” company.

The department store giant will close five namesake stores and cut approximately 2,350 jobs, or about 3.5% of its workforce, with most of the cuts occurring at the corporate office. he news was first reported by The Wall Street Journal. The layoffs come as Macy’s is looking to reduce expenses.

The cuts come as Macy’s plans to unveil a new strategy under a new CEO. Jeff Gennette, who has led the company since 2017, will retire in February, handing the reins over to Tony Spring, chairman and CEO of the company’s luxury Bloomingdale’s division. They also occur amid a $5.8 billion takeover bid by a group of investors to take the company private.

“As we prepare to deploy a new strategy to meet the needs of an ever-changing consumer and marketplace, we made the difficult decision to reduce our workforce by 3.5% to become a more streamlined company,” the company said in a statement to Chain Store Age.

The five Macy’s stores that are being closed are located in Arlington, Va.; San Leandro, Calif.; Lihue, Hawaii; Simi Valley, Calif,; and Tallahassee, Fla., according to CNBC. As of Oct. 28, Macy’s had 784 stores, including its namesake locations, Bloomingdales and Bluemercury.

The store closings comes as Macy’s has been focusing on the expansion of its off-mall, downsized store concept. In October, the company said it would open up to 30 small-format stores through fall 2025, starting next fall. The stores are about one-fifth the size of a full-line Macy’s, which average from 180,000 to 200,000 square feet.

In November, Macy’s reported a better-than-expected third quarter as improvements in gross margins and merchandise inventory helped offset declining sales. Sales fell 7.1% to $4.86 billion, ahead of estimates of $4.78 billion. Digital sales decreased 7%. Same-store sales were down 7.0%. Same-store sales fell 7.6% at Macy’s and were down 3.2% at Bloomingdale’s. Comp sales rose 2.5% at Bluemercury.