Department store chains Macy’s and JC Penney are closing several locations and cutting down on employees in 2015 to focus on aligning services with consumer demands and habits, and to ensure company success.
Macy’s, which also owns the Bloomingdale’s chain, announced it would restructure by moving workers from 830 Macy’s and Bloomingdale’s stores and shutting down operations at 14 locations. This move could cut up to 2,200 employees.
The move is expected to save the chain $140 million per year starting in 2015 and will help offset higher expenses anticipated from healthcare and retirement plans.
The company also announced it would open two new stores: a Macy’s in Los Angeles in 2016 and a San Jose Bloomingdale’s by late 2017. Additionally, Macy’s said it would hire about 1,500 associates in 2015 for the direct-to-consumer fulfillment center in Oklahoma, which is slated to begin operations in April.
Macy’s is looking to shift its attention toward services such as in-store pickups for online orders and “ship-from-store,” which allows customers to order items from another store location if it is unavailable and have it delivered to their homes.
Terry Lundgren, Macy’s CEO, noted that Bloomingdale’s and Macy’s websites, apps and fulfillment systems performed well during the holiday season.
“Our business is rapidly evolving in response to changes in the way customers are shopping across stores, desktops, tablets and smartphones,” he said in a statement. “We must continue to invest in our business and to focus on where the customer is headed – to prepare for what’s next.”
Locations to be closed include three in California, one in New Jersey and one in New York.
According to the company’s latest quarterly filing, Macy’s operates about 840 stores, including 13 Bloomingdale’s outlets.
JC Penney is shutting down approximately 40 stores and laying off 2,250 workers.
“We continually evaluate our store portfolio to determine whether there’s a need to close or relocate underperforming stores,” said Sarah Holland, JC Penney media relations manager.
“Reviews such as these are essential in meeting our long-term goals for future company growth. While it’s never an easy decision to close stores, especially due to the impact on our valued associates and customers, we feel this is a necessary business decision.”
JC Penney said mall-based stores in 19 states will close by early April.
Among locations facing closure include one in New Jersey and one in New York, according to USA Today.
(With reports from Reuters and The Wall Street Journal)
(www.asianjournal.com)
(LA Weekend January 10-13, 2015 Sec. D pg.1)
