Macy’s store is suffering the hit of the online retail market for long now and forced to shut down their operational outlets slowly. Last year, the Macy’s store announced the closure of nearly 60 outlets due to the reduction in their sales revenue and unable to meet the operational expenses of those stores due to shifting towards online market by the customer. They also projected to close further 60 more stores in coming few years if the situation doesn’t improve and the conditions are worsened for them. Until now, they have announced the closure of 11 more stores and all the information is already been sent to those stores about the closure. Those stores whose lease agreements are about to end and those whose sales transactions are completed would be the first in the list to be closed by Macy’s.
Their projection about the closure of more stores in the coming few years is strong enough to be executed accordingly. This is clearly visible with the number of closures they executed during the last year and projected for this year. There would be an official announcement made every time based on their sales revenue and profits about the exact number of outlets to be closed during that fiscal quarter. After the disclosure of this news across the country, there was a hit to their share price which went down nearly 3.7 percent. This downfall has forced the company to divert their focus towards their portfolio of real estate and divert their investments in some other business opportunities and make optimum utilization of their real estate so that they are able to improve their financial position. The company regrets to make such difficult decision of closing down their retail outlets since it affects their customer base and impacts the customer loyalty to a great extent.
They also have diverted their focus on development and maintenance of web operations with the creation of the webpage of their brand in order to tackle the online competition and maintain their financial position to improve their growth and development of their brand. The brand is indulged in various online operations offering various discounting and pricing strategies in order to attract the attention of the customers and boost their sales revenue. Many retail brands have revamped their floors and restructured their operational activities in order to regain their lot position in the minds of the customers and induce them to visit the store and have a different kind of special treatment and attention. The Macy’s is currently also facing issues from their major shareholder, Starboard, after the separation of their real estate business from their retail business.