Macy’s, the US department store chain, has revealed plans to cut 2,350 jobs and shut five stores, constituting 3.5 per cent of its total workforce.
The company, which operated 722 stores as of January 2023, employs around 94,570 full- and part-time staff, excluding seasonal hires.
According to Reuters, the restructuring initiative is part of Macy’s broader strategy to adapt to evolving consumer trends and marketplace dynamics.
The decision to slash jobs aligns with an ongoing $5.8 billion offer by an investor group, Arkhouse Management and Brigade Capital, to take Macy’s private.
Incoming CEO Tony Spring is spearheading efforts to trim expenses on promotions, aiming to enhance profit margins following the inventory surplus experienced by Macy’s in 2022.
The job cuts are integral to the company’s strategic shift and its commitment to meeting the demands of an ever-changing consumer landscape.
Macy’s spokesperson stated that the layoffs are part of a comprehensive plan to deploy a new strategy aligned with market shifts.
As the company assesses the optimal mix of on- and off-mall locations, it plans to close five full-line stores in the coming year.
The Wall Street Journal, citing an internal memo to employees, reported that the layoffs are scheduled for January 26.
The move follows Macy’s robust performance in November, where it surpassed analysts’ profit estimates for the quarter.
Lower inventories and robust demand for beauty products contributed to the positive results.
The streamlining effort, while driven by internal factors, also responds to external pressures from investor groups eyeing Macy’s privatisation.
The company aims to navigate challenges and position itself strategically in the competitive retail landscape.
(With inputs from Reuters)
