Macy’s has planned another 5,000 job cuts and will close another seven stores that were not previously listed for closure, as it looks for stability during a difficult retail climate for brick and mortar locations.
The cost reductions by the retailer come after holiday sales in its stores opened 13 months or more rose by just 1.1%. Although, Macy’s called its holidays sales solid, their performance trailed other department store chains such as J.C. Penney, which on Thursday posted an increase of 3.4%. When news of the closures and job quotes was released, Macy’s stock was down by over 7%.
The retailer also announced it will shutter another seven locations previously not named in other closures.
These moves come as part of Macy’s plan that was announced back in August of 2016 of closing 100 locations and in all, the company has revealed 81 of those 100 locations.
Including the reductions at locations that are remaining and the store closures the job cuts will total approximately 5,000.
In addition, Macy’s said it would be adding jobs at certain locations in order for stores to be properly staffed.
Liquidation sales at stores will likely start January 8 and last for between eight and 12 weeks.
As far as 2018 is concerned, the company is focused on continually improving and will take all necessary steps to become faster, execute in a more effective manner and to allocate resources for investing in growth, said Jeff Gennette the CEO at Macy’s in a prepared statement.
The company has struggled with is huge real estate holdings and model of traditional retail, as Amazon.com continues to surge upward and its physical competitors like Marshall’s and T.J. Maxx offer more alternatives.
Despite its challenges, Macy’s posted strong performances for its beauty products, active apparel, dresses, shoes, coats, and fine jewelry amongst a few others.
The company added that its online sales surged by double digits.
Macy’s was credited by analysts with incremental improvements although the increase in sales might have been attributable in a large part to the current strong economy, added on retail analyst.
The analyst added that everyone recognized changes were made and are beginning to have positive impact on its performance. However, the results are not sufficiently strong enough to suggest Macy’s has transitioned the business to where it needs to be or that its future success can be guaranteed.