Down a size
“America’s Department Store” is moving away from traditional malls, following years of reduced footfall and competition from other retailers, as Macy’s announced plans yesterday to open 30 new small-format stores by the end of 2025.
Indeed, the Macy’s group is returning to its roots as a small shop 165 years after its founding — opening 12 Macy’s and 3 Bloomingdale's stores that will be about one-fifth of the size of its typical outlets — after closing ~80 of its locations in the past 3 years, mainly in struggling shopping centers.
Despite having been a mall staple for decades, the shuttering of the legacy brand’s megastores, and the decision to expand in compact locations, reflects what seems to be a permanent change in consumer habits. The company’s shares have shed 66% of their value in the last 5 years, as sales have stalled. Macy’s management are hoping that the slimmed-down stores with curated merchandise in convenient locations will prove “more efficient to operate” and help “ensure long-term viability”.
Although times are tough — with J.C. Penney and Neiman Marcus filing for bankruptcy — it would be a gross overstatement to say that the great American mall is under threat of extinction. While some of the biggest names in retail may need to prune their portfolio, a new report “The State Of The American Mall” found that mall sales overall actually grew 11% last year.