Retailer to shutter Beaumont location in series of closures
Macy’s, Inc. announced Wednesday, Jan. 4, that it would be closing 68 of its stores in a series of actions to streamline its store portfolio, intensify cost efficiency efforts and execute its real estate strategy.
The Beaumont location is included in these closings. The Parkdale Mall location is 171,000 square feet, opened in 2002, and employs 67 associates. According to Macy’s spokesperson Melissa Goff, the final clearance sale began on Monday, Jan. 9, and will run 10 to 12 weeks.
Of the 68, three closed mid-year, 63 will be closed in early spring 2017 and two will be closed in mid-2017. Three other locations were sold, or are to be sold, and are being leased back. The company intends to opportunistically close approximately 30 additional stores over the next few years as leases or operating covenants expire or sale transactions are completed, bringing the number of closures to aroud 100.
The actions are estimated to generate annual expense savings of approximately $550 million, beginning in 2017, enabling the company to invest an additional $250 million in growing the digital business, store-related growth strategies, Bluemercury, Macy’s Backstage and China, according to a release by the company.
“Over the past year, we have been focused and disciplined about making strategic decisions to position us to gain market share and return to growth over time,” said Terry J. Lundgren, chairman and chief executive officer of Macy’s Inc. “While we are pleased with the strong performance of our highly developed online business, as well as the progress we have made on selling and visual presentation programs and expense reduction initiatives in 2016, we continue to experience declining traffic in our stores where the majority of our business is still transacted.”
As a result of closing 63 Macy’s stores in early 2017, along with the three closed mid-year 2016, the company’s 2017 sales are expected to be negatively impacted by approximately $575 million.
Associates displaced by store closings may be offered positions in nearby stores where possible. Eligible full-time and part-time associates who are affected by the store closings will be offered severance benefits. The company estimates that 3,900 associates will be displaced as a result of these closures.
“These are never easy decisions, and we are committed to treating associates affected by these closings with respect and transparency,” Lundgren said.
Two new Macy’s stores are currently planned and/or under construction in Los Angeles and Murray, Utah.
CBL & Associates Properties Inc., which manages Parkdale Mall, would not release specifics on the store that is expected to replace Macy’s, but said that CBL is currently working to contract with a business.
On the WARN Act list of layoffs reported to the Texas Workforce Commission in the past several weeks, published Monday, Jan. 9, all the listed layoffs are associated with Macy's closures. March 6, Macy's plans to lay off 144 employees in Plano, 83 in El Paso, 144 at West Oaks Mall in Harris County, 119 at Collin Creek Mall in Collin County and 83 in Pasadena.