NEW YORK – Now six months into Macy’s “Bold New Strategy” initiative, firm execs this morning assessed the present retail setting and the goals of its 3-year transformation effort.
The roughly 30-minute dialog on the Goldman Sachs 31st Annual Global Retailing Conference touched on plenty of subjects. Listed below are the 5 fast highlights from the session.
Early learn on Q3 efficiency: The third quarter kicked off on Aug. 4, and Macy’s Inc. remains to be seeing the pattern which emerged in the course of the second quarter: shoppers in any respect earnings ranges are being extra cautious about their spending. Macro financial pressures, world occasions and the presidential political season are weighing on their choices. “The posh shopper shouldn’t be immune from this uncertainty and this discomfort,” stated Tony Spring, Macy’s Inc. chairman and CEO.
Stock winners and losers: The corporate continues to drag again on stock in classes which can be struggling and is chasing items, when essential, in classes which can be doing nicely. Spring stated he’s extra centered on the composition of the combination than the general amount of stock. “It’s not simply the [Backstage] off-price group that goes again into the market and appears for alternatives; we do too,” he added. For the again half and vacation quarter, shops can have extra newness than they did final yr.
Bumping up the shop closing schedule: The current resolution to shutter 55 Macy’s department stores this year as a substitute of the unique group of fifty displays the corporate’s need to wash the slate as shortly as attainable – and the urge for food in the true property market to snap up its areas. “I really like shops,” stated Spring. “However dangerous shops are dangerous shops. They’re both in dangerous situation or in malls that aren’t in a wholesome situation, or the shops are too large, or they don’t generate profits.”
Reconfiguring Macy’s shops: The Macy’s of the longer term is being solid on the firm’s take a look at group often called the First 50 stores. The objective is to create a greater merchandise assortment, a extra visually compelling presentation, much less density on the ground, higher product circulation and extra staffing. “When Macy’s was at its greatest, it went from low [price points] to excessive. However it additionally had a willingness to experiment on classes and types,” stated Spring.
Competitors from the off-price channel: Requested concerning the booming market share off-price retailers are gobbling up, Spring famous that there are few gamers left in its retail area. Macy’s will grow to be “an assisted promoting expertise” with extra workers on the ground in key departments whereas the off-price Backstage shop-in-shop will proceed to supply extra sharply priced items.
“I don’t subscribe to [the idea that] 100% of the enterprise with shoppers will go to off-price or go to mass,” he stated.
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