Introduction
In a major shift for one of America’s oldest department stores, macy’s to close 150 stores after sales drop $21.3 billion. This announcement came as a response to changing shopping habits and tough market conditions. Macy’s, a name tied to holiday parades and big-city shopping, now faces the need to adapt. Shoppers wonder what this means for their local stores and deals. This article dives into the details, from the company’s rich past to its bold steps forward. We draw from reliable sources to give you clear facts and helpful insights.
The History of Macy’s: From Humble Beginnings to Retail Giant
Macy’s started in 1858 when Rowland Hussey Macy opened a small dry goods store in New York City. He aimed to sell quality items at fair prices. The store grew fast, moving to its famous spot on 34th Street in 1902. This location became known as the world’s largest store, covering a full city block. Macy’s on 34th Street drew crowds with window displays and events.
Over the years, Macy’s expanded across the U.S. By the 1920s, it hosted the first Thanksgiving Day Parade, a tradition that still brings joy today. The company survived hard times like the Great Depression and World War II. In the 1990s, Macy’s bought other chains, growing to over 800 stores at its peak. It became part of Federated Department Stores, later renamed Macy’s Inc.
Macy’s achievements include pioneering credit cards for stores and same-day delivery tests. It also supported causes, like hiring diverse staff early on. Famous for movies like “Miracle on 34th Street,” Macy’s holds a special place in culture. But recent years brought challenges. Online shopping rose, and malls lost foot traffic. These factors set the stage for the current changes.
Understanding the Sales Drop: Key Factors Behind the Decline
Macy’s saw a sharp fall in sales, leading to the decision on macy’s to close 150 stores after sales drop $21.3 billion. In 2023, net sales dropped 5.5%, reaching about $23 billion overall, but the focus on the $21.3 billion figure highlights the adjusted impact after costs and shifts. Experts point to several reasons.
First, the COVID-19 pandemic changed how people shop. Lockdowns closed stores, pushing buyers online. Even after reopening, many stuck with e-commerce giants like Amazon. Macy’s online sales grew, but not enough to offset in-store losses.
Second, malls declined. Many Macy’s locations sit in aging shopping centers with empty spots. Foot traffic fell as consumers preferred outdoor strips or direct-to-home buys.
Third, competition heated up. Discount chains like TJ Maxx and fast-fashion spots like Zara drew budget shoppers. Luxury buyers went to brands like Nordstrom. Macy’s middle-ground appeal weakened.
Statistics show the trend. In fiscal 2023, comparable sales fell 6.6%. By 2024, they improved slightly to a 0.9% drop, but challenges remained. Tariffs on imports from China affected 20% of goods, raising costs. Macy’s managed this by negotiating with suppliers and adjusting prices carefully.
The Announcement: Details on the Store Closures
Macy’s revealed its plan in February 2024, calling it “A Bold New Chapter.” The company will shut 150 underperforming stores by 2026’s end. These spots make up 25% of square footage but only 10% of sales. By early 2026, over 135 closures happened, with 55 in 2024, 66 in 2025, and 14 more planned for 2026.
Closures hit states like California, Texas, New York, and more. For example, the Grossmont Center store in La Mesa, California, closed in early 2026. Liquidation sales started in January, offering up to 70% off. Shoppers grabbed deals on clothes, home goods, and more.
CEO Tony Spring shared in a memo: “These decisions are tough, but they help us move forward.” He praised staff efforts during holidays. The plan focuses on closing weak spots while boosting strong ones.
Impact on Employees and Communities
Store closures affect people most. Each Macy’s employs about 100-200 workers. With 150 stores, thousands face job loss. Macy’s offers severance and help finding roles at other locations. Some move to online fulfillment centers.
Communities feel the hit too. Malls lose anchors, leading to more empty spaces. Local economies miss tax revenue and jobs. In places like San Diego County, the Grossmont closure saddened residents who shopped there for years.
But there’s reassurance. Macy’s invests in remaining stores, creating new positions. Small-format stores in outdoor centers bring jobs to growing areas. One test store in San Diego succeeded, leading to 30 more by fall 2025.
Future Plans: Investing in Growth and Luxury
Macy’s isn’t just cutting back. The strategy includes upgrades to 350 “go-forward” stores. These get better staffing, like more help in fitting rooms. Displays improve, and experiences get curated for shoppers.
Focus shifts to luxury. Bloomingdale’s and Bluemercury outperform Macy’s. Plans add 15 Bloomingdale’s and 30 Bluemercury spots. Small-format Macy’s stores, about 30,000 square feet, target busy suburbs.
Digital gets a boost too. Faster shipping, personalized apps, and site upgrades aim to grow online sales. In 2024, asset sales from closures brought $144 million, funding these changes.
Analysts see promise. Goldman Sachs raised its target to $22, JP Morgan to $23. Adjusted earnings for 2026 forecast $2.00-$2.20 per share.
How This Compares to Other Retailers
Macy’s joins a trend. JCPenney closed stores after bankruptcy. Sears shrank massively. Bed Bath & Beyond shut down fully. Even Dollar General closed 141 spots in 2025 due to low spending.
Reasons overlap: online shifts, inflation, and changing tastes. But Macy’s adapts better than some. Nordstrom focuses on luxury too, with success. Walmart thrives by mixing in-store and online.
Macy’s history helps. Founded in 1858, it survived depressions and wars. A 1912 story: Macy’s owner died on the Titanic but left a strong legacy.
Statistics and Examples: A Deeper Look
Let’s break down numbers:
- Pre-pandemic stores: Over 700.
- Post-closures goal: 350.
- Sales impact: Closed stores = 10% of sales.
- Asset gains: $144 million in 2024.
- Online growth: Up during pandemic, now key focus.
Examples include the 34th Street flagship. It’s famous for holidays, like the recent Holiday Square market with local vendors. Macy’s on 34th Street remains a draw, not closing.
In California, two stores shut: La Mesa and Tracy. Shoppers shifted to nearby spots or online.
Tips for Shoppers During Closures
Stay smart with these steps:
- Check store status: Visit macys.com for updates.
- Hit liquidation sales: Save big, but act fast.
- Go online: Free shipping on orders over $25.
- Try small-format stores: New spots offer quick shopping.
- Explore luxury: Bloomingdale’s for upscale finds.
These help you adapt without stress.
The Role of E-Commerce in Retail Changes
Online shopping drives much of this. In 2023, U.S. e-commerce hit $1 trillion. Macy’s app and site see heavy use. Upgrades include AI for recommendations.
But physical stores matter. Macy’s blends both, like click-and-collect. This hybrid wins customers back.
Economic Insights: Broader Retail Trends
Retail faces inflation and supply issues. Tariffs add costs. Macy’s negotiates to keep prices fair.
Positive signs: Holiday 2025 sales rose. Comparable sales improved 5.1 points from 2023.
For more on business trends, check this resource.
Challenges Ahead and How Macy’s Addresses Them
Risks include slow turnaround and format limits. Experts warn of trade pressures. Macy’s counters with share buybacks worth $1.4 billion.
Reassuringly, the plan shows progress. By 2026, most closures done, focus on growth.
Macy’s to Close 150 Stores After Sales Drop $21.3 Billion: Key Lessons
This heading spotlights the core issue. Lessons include adapting fast to trends. Macy’s pivot to luxury and digital sets an example.
Frequently Asked Questions (FAQs)
Why is macy’s to close 150 stores after sales drop $21.3 billion?
Due to shifting to online, mall declines, and competition.
Which states are affected?
California, Texas, New York, and 16 more.
What about jobs?
Severance offered; some relocate.
Will prices change?
Liquidation deals now; stable elsewhere.
How to shop Macy’s now?
Online or at remaining stores.
Conclusion
In summary, macy’s to close 150 stores after sales drop $21.3 billion marks a reset for growth. From its 1858 start to today’s Bold New Chapter, Macy’s adapts. Closures trim weak spots, while investments in luxury, digital, and small stores promise a brighter future. Shoppers gain from deals and better experiences. The company reassures with progress, like improved sales and analyst nods.
What do you think Macy’s next big move should be? Share in the comments!
References
- BusinessNile: Macy’s to Close 150 Stores After Sales Drop $21.3 Billion – Details on announcement and strategy.
- FOX5 San Diego: Grossmont Center Macy’s Closing – Local impact example.
- Playbill Facebook Post: Macy’s on 34th Street – Historical context.