Macy's Closing 11 Stores Nationwide

NEW YORK — Department-store operator Macy's Inc. said Thursday it will close 11 underperforming stores in nine states _ affecting 960 employees _ and lowered its forecast for the fourth quarter after one of the weakest holiday seasons in years.

Stores slated to close include locations in Los Angeles, West Palm Beach, Fla., Nashville, Tenn., and St. Louis, among others. Cincinnati-based Macy's Inc. says the closures will cost about $65 million, most of which will be booked in the 2008 fourth quarter.

Clearance sales at the stores begin next week.

"These closings are part of our normal-course process to prune underperforming locations each year in order to maintain a healthy portfolio of stores," said Macy's Chief Executive Terry J. Lundgren in a statement.

Employees at the stores that are closing may be considered for open positions at other Macy's stores, the company said.

Department-store operators have been among the harder-hit in the retail sector as consumers cut back amid the recession, hunting for bargains and trading down to discounters.

Macy's reported Thursday that its December sales at stores open at least a year, or same-store sales, fell 4 percent _ still not as bad as the 5.3 percent drop analysts surveyed by Thomson Reuters were expecting.

Total sales for the five-week period ended Jan. 3 fell 5 percent to $4.4 billion from $4.61 billion last year.

Same-store sales fell 7.5 percent during the combined November and December holiday period. Macy's said the holiday season ended with improving sales in the fourth and fifth weeks of December but that sales were sluggish before that.

The company said it marked items down sharply in the fourth quarter to gain sales and reduce its inventories, but that hurt its margins and led it to lower its profit forecast for the fourth quarter and full year.

Macy's now expects earnings of 90 cents to $1 per share in the fourth quarter, down from its previous guidance of $1.10 to $1.30 per share. Analysts expect earnings of $1.11 per share.

For the full year, the company now expects to earn $1.10 to $1.20 per share, down from its previous forecast of $1.30 to $1.50 per share. Analysts expect a profit of $1.35 per share.

Comments

[Shemeka Sowell]

I work for Macys and know that the stores that are closing are low performing stores that are next door to or down the street from larger Macys stores. Also, Macys carries great stuff and unlike some major retailers have weekly coupons or macys card events. There are always discounts are merchandise and if people are patient can easily buy items that used to be really expensive for a great price. To the person who shops at the discount retailers-all that stuff u buy at those discount retailers come from stores like macys. If it weren't for macys than places like ross or marshalls would not exist. More jobs would be lost. Think about that for a little bit. I think that everyone should just continue to live their lives. Shop if you want to, the business would be appreciated. Lastly, no one goes all nuts when a grocery store closes why now are people criticizing macys for just doing what they must to survive in a struggling economy. Macys employs a lot of hard working people and should not be faulted for attempting to take the high road and instead of asking congress for a bailout like our lovely u.s. banks.

[vippy]

ROSS cannot be beat - name brands and for a fraction of the cost everywhere else. The push for the
producitive to impress Wall Street brought about the lack of customer service in the stores.
Think about it.

[vippy]

Malls started to die in 2000. No news here.

[Mahi Joe]

Macy's is turning into a retail store monopoly. After the acquisition of all the Marshall Fields stores, Macy's openily bragged about now owning 800 stores. I wish someone who understands the Chicago buyer would purchase back the Marshall Fields stores and bring the quality we once knew back.

[strangerinthenight]

I used to shop at Macy's. Nowadays, I window shop at Macy's.

[munki]

big boxes - maintenance costs are too high...

[Episcopagan]

"Minor" point here.

The stores being closed are in what is known as "d.ead malls."

The West Palm Beach store, for example. That mall has already lost its Lord & Taylor and Dillards.

The downtown Los Angeles store is a former RobMay. It is directly across the street from a much larger Macy's. It has only been kept open because of the lease. The lease is now up for renewal.

What the article also fails to mention is that Macy's is opening 6 NEW stores this year, after opening 5 new stores last year.

[1201SLD]

Macy's swallowed up quality regional stores and cheapened them with the Macy's name and merchandising strategy. Few consumers will miss their homogenized approach.

[wm1066]

Your right, after Macy's took over Marshall Fields the quality took a real nose dive. They also got rid of some of the good services that the store was known for. And now terry lundgren is wondering why people don't shop at his stores! Actually people dislike Macy's like they dislike Walmart.

[Strywever]

I agree. In the Seattle area, Macy's took over a small chain called the Bon Marche. Almost immediately, locating a salesperson became nearly impossible and merchandise quality went down.

[maumeeone]

It's unfortunately the what I call the homogenization of America. Where I live, I could always find something in the men's department at Hudson's. Perhaps even too much! Hudson's then became Marshall Field's, which was enjoyable, as well. Ever since it changed to Macy's, I can't find anything worth buying. Now I just use it as a way into the rest of the mall. I don't even bother anymore to try to find anything I like there. So combined with a crappy economy, is it any wonder why their sales are off?

[Mahi Joe]

You are so correct. Even Marshall Fields old house brand, Fieldcrest, was great quality but unfortunately replaced by Macy's own house brand which is pure junk. I used to do quite a bit of shopping at Marshall Fields but now I can find better and more reasonably priced merchandise elsewhere. One of the things Lundgren bragged about when Macy's purchased Fields was that Macy's having now 800 stores can have greater buying power and pass along the discounts to the customer. He failed to mention anything about quality. The Chicago customer is not like the NY customer and now Macy's buys one size fits all which doesn't work.

[ranchero42]

Macy's understands how you need to spend money to make money. They just picked a lousy time to make either one happen. Just because I gave up on malls years ago doesn't mean I don't feel sorry for those who will now enjoy them less.

[iPolitics]

geez

[sonoffestus]

I prefer thrift shops, goodwill etc. My wife has problem once in a while, but I let her buy me a 'good" pair of slacks and shirt once every few years. it keeps her happy and I have something "nice" to be buried in. Come to think about it, I'm being creamated. I guess I have enough of those "good' clothes to last me a lifetime.

Recently , I purchased a brand new Columbia rain and wind jacket, $15.00 CND, (12 US$). I found it at a seniors thrift store. Bought the wife a silk 3 piece outfit for $11.00 at the same place. She loves it and looks hot in it. You have to hit the thrifts regularly as the good things move fast, but if you do you'll find great stuff. Forget the mall stores , have fun, support a good cause, shop thrift! Recycling can be fun.

[CFAmick]

The secondary market for clothing more accurately reflects its value.

[citizenfirst]

Bought an absolutely cool bike (Dutch style) for $30 bucks at a thrift store! I'm a total convert now, and don't ever expect to go back to the mall for newsies! And yes, the secondary market does accurately reflect the real value of merchandise. I am suspicious, however, that the real good stuff is being sold online or elsewhere after it has been sorted by the thrifts. Anybody out there know if this is true?

[SiberianRat]

AMEN! Moreover, thrift-store shopping can be fun--kinda like a treasure hunt.

[NWBrunette]

Have been doing this for years. Among my women friends the only ones who dress anywhere near as nice as I also shop at thrift stores. We are so much more fashionable and attractive than our "mall" sisters.

[jerrypl]

January 1, 2009 marked the first day of the coming depression. The retail sector has 1 million workers who will lose their jobs. The retail sector is 10% of the economy. Once retail jobs disappear, as we are seeing with not only Macy's, but hundreds of stores, those store fronts will be empty for a long time to come. Malls will shut down due to retail spending shrinkages, and, therefore, rents will collapse. When those rents disappear, those land developers will go broke, and that will ripple up into the financial lenders, who will run to the Fed for a bail out. The corporate welfare state has arrived. But those workers will find not bail outs for themselves, except for unemployment checks. We have seen 14,000 newly unemployed everyday since September!!!

This bail out is a result of a 30 year government supported Ponzi Scheme beginning with Reagan and finally ending with Bush. The working class were the patsies. The financial vampire predators enticed the working class with cheap credit, since their wages were purposefully kept stagnant. Now they are tapped dry and the credit markets have frozen up. The rich have now learned they cannot stimulate the economy. WIthout working Americans spending and having good wages to support their spending, the economy fails.

But the Ponzi Scheme continues.

http://eye-on-washington.blogspot.com

[nwsun]

Those retail malls may become mega churches.. the mall I used to patronize on Saturdays as a teenager, became a mega church... The space that was once J C Penny's is now the church portion and the other spots in the mall serve as retail outlets that provide services to the patrons of the church.. the parking lot is full most days of the week from what Im told... its the new big business. maybe that's why Obama chose Rick Warren... the new mega churches are the new union halls...

[SonofLiberty1]

Now, if you want expensive stuff you would go to Neiman Marcus....

[SonofLiberty1]

And with the advent of Walmart who can undercut everyone in price, how many other dept stores have a chance?

[MsLiz]

I know you are not referring to the grocery business, but I must interject that Wal-mart meats are suspect. They allegedly inject water into the meat to increase the weight (see "watered stock"). I purchased some pork chops there once and I swear they were waxy. Neither humans or the dog would eat them.

Wal-mart can not compete with the better service other stores have historically offered; of course, that may be diminished in the near future too.

[Gifts]

Shop MACYS! Totally very affordable and has so many different departments for every need, home, self, skin. The best thing we can do is get out and LIVE and stop listening to the doom and gloom.

[SonofLiberty1]

You apparently are Republican and have a JOB still.
Be careful my friend..yours is next!

[MsLiz]

That was rude.