Business

Macy’s sales plunge in 2020 highlights pandemic sacrifice in retail

Macy’s, a retailer that also owns Bloomingdale’s and Blue Mercury, Said on Tuesday Last year’s sales plummeted 29%, highlighting the damage caused by the pandemic. Taken with a mall chain And uncertainty about how traditional retail will recover in the post-pandemic world.

According to Macy’s, sales for the year ended January 30 fell to $ 17.3 billion, with a net loss of $ 3.9 billion compared to a profit of $ 564 million the previous year. According to the company, after the holiday season exceeded expectations, “2021 is expected to be a year of recovery and reconstruction,” and momentum is gaining in the second half of the year. Fourth-quarter sales were down 19% year-on-year.

With more than 700 stores, Macy’s is often considered a barometer of consumer health in department stores, shopping centers, and the United States. On Tuesday, executives emphasized that Macy’s is building a digital business and expects to reach $ 10 billion in sales over the next three years. As part of the previously announced store closure, we are moving away from disadvantaged American malls and expanding off-price chains such as Macy’s Backstage to compete with TJ Maxx. And we’re testing a small store called the Macy’s and Bloomies Market, away from traditional malls.

“We go to lifestyle centers and strip centers because there are a lot of customers who don’t want to go to the mall and the best mall in the town isn’t near their home,” Jennet said in an interview on Tuesday. “Macy’s And Bloomingdale’s generally don’t play there. That’s what we’re testing. “

Macy’s business is heavily impacted by the slump in apparel sales simply because many opportunities to demand dress-ups from people during a pandemic did not occur. Jennet said dressy clothing remained “very depressed” and did not anticipate a resurgence of such items until the fall, but the company is a sign that vendors are improving sooner.

The New York-based company was looking for “what’s happening on wedding dates, what’s happening on restaurant reservations, and what signs the community is starting to open up.”

“I don’t think I’ll see it in the summer,” Jennet said. “I think it will be late. That’s what we react to in the third or fourth quarter.”

He said apparel will not play a very important role in Macy’s future. The company said in a statement that sales surged in areas such as household products, luxury skin care, fragrances and fine jewelry.

Even before the pandemic, Macy’s was in a tense state.Last February, the company said that Scheduled to close about 125 We increased the number of the least productive stores in three years and reduced the position of about 2,000 companies and support departments. Sales in 2019 fell from $ 25 billion in the previous year to $ 24.6 billion and were removed from the S & P 500 last year due to the company’s inventory decline. Employment and store cuts were part of a three-year plan to bring Macy’s back to sustainable and profitable growth, referred to its star logo, called the Polaris Strategy.

Many consumers were moving away Malls and department stores Virtually in the last year Changed their consumption habits In a new and isolated world. Macy’s’ position in American culture was also hit. This outbreak has reduced the annual fireworks and Thanksgiving parades in New York.

Other than shopping malls, Macy’s and Bloomingdale’s flagship stores in major cities are suffering from reduced foot traffic from office workers and the loss of international travelers. Mr. Jennet said Macy’s did not require its corporate staff to return to the office until the fall, yet expected a “hybrid culture” for work in the office.

He said tourists are likely to return home later. “Our modeling doesn’t expect us to come back until the end of 2021, but it’s actually from 2022,” he said, and the company has pre-booking, plane fares, hotel occupancy, etc. He added that he would continue to monitor his signal. Fee.

He added that he expected city stores to “continue to be challenged” until tourists and workers returned.

Macy’s sales plunge in 2020 highlights pandemic sacrifice in retail

Source link Macy’s sales plunge in 2020 highlights pandemic sacrifice in retail

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