Macy’s has been around since 1858. The company is the largest department store globally, with more than 500 stores nationwide. It’s also one of the best apparel brands in the United States. But despite its success, it might be possible that Macy’s going out of business.
As part of its growth strategy, Macy’s closed four stores in California, Colorado, Maryland, and Hawaii on January 2023. The company aims to reduce expenses and transition towards establishing new independent stores nationwide by streamlining its least productive locations.
These changes at Macy’s make us think it might not last much longer. So is Macy’s going out of business? We don’t know yet, but here are some reasons to believe it could happen.
What is Macy’s?
The history of Macy’s is a timeline of retail innovation and evolution. Founded in 1858, Macy’s was initially known as R. H. Macy Company, or simply “Macy.” The company’s namesake founder, Rowland Hussey Macy, established a small inventory of women’s clothing for sale in downtown Manhattan, New York.
In 1875, Rowland Hussey Macy died, and his son-in-law Abraham Abraham assumed control of the company. In 1896 the company adopted its new name: “R.H. Macy & Co.”
It wasn’t until 1924 that R. H. Macy & Co. expanded beyond department stores with the acquisition of the then-named “Bullock’s” chain of Los Angeles department stores from John Glessner on behalf of a consortium led by Simon Goodwin. He was a member of Chicago’s leading families -the Levi Strauss clan and the Marshall Field III family (the Marshall Fields).
Macy’s has one of the most recognizable brands in the world. With 39 stores, they currently rank as the eighth-largest retailer in the United States. The company offers a wide range of stylish merchandise for the whole family in 45 states, Guam, Puerto Rico, and China.
The company’s original name was R. H. Macy Dry Goods Company, and it was renamed Macy’s in 1896 when it became incorporated (R. H. Macy Co., 2004).
In 1928, the company merged with Federated Department Stores and took on Macy’s Incorporated (Macy’s, 2017). They have continued to grow over time, expanding into Canada in 1994, China in 2008, and re-entering the Middle East by opening its first store there on October 15, 2017. But recently, the company has been making headlines because of certain rumors – Is Macy’s going out of business?
Controversies
In July 2003, then-New York State Attorney General Eliot Spitzer launched an investigation of the private policing system Macy’s has used to deal with suspected shoplifters. The research was prompted by a civil rights lawsuit and an article in “The New York Times,” which reported Macy’s tactics, including private jails and interrogations.
Spitzer found that many of their actions were unlawful; they paid out $600K (equivalent to $795k in 2022) as a settlement for discriminatory practices against ethnic minorities. On June 6, 2006, Boston’s Jordan Marsh flagship store removed two mannequins and the Web address for AIDS Action Committee from its window display promoting Boston Pride celebrations due to pressure from Christian groups who disagreed with homosexuality.
What are the rumors?
Rumors have circulated that Macy’s is going out of business, but other things are happening to the company that may contribute to its demise.
The company has been closing stores and cutting jobs to stay afloat. The company had announced its intention to shut down a total of 125 stores and eliminate numerous jobs with the aim of reducing costs, fostering team collaboration, and eliminating redundant tasks, as stated by Macy’s CEO Jeff Gennette.
This isn’t the first time Macy’s has had problems. In 2015, the company reported a loss after declining revenue due to customers shopping less at brick-and-mortar stores. Sales have also decreased because many people are now buying their clothes online.
In 2020, Macy’s commenced the closure of several stores, and this continued in 2021 and 2022, including the closure of seven locations in January of the previous year.
Macy’s is no stranger to financial struggles; they’ve filed for bankruptcy before. In 2003, they filed for Chapter 11 bankruptcy protection, reduced their debt by $1 billion, and shuttered 36 underperforming stores nationwide.
What are the facts?
To evaluate the case of ‘Is Macy’s going out of business?’ we have some facts to go through-
1. Macy’s announced its intention to close 125 stores as part of its three-year restructuring plan in 2020.
2. Macy’s is losing money, and this problem is expected to continue into the foreseeable future.
3. In 2016, the company’s stock fell to an all-time low of $27 per share.
4. After closing stores and cutting back on staff, they also need some serious cash infusion to keep going forward.
5. The company’s current CEO has been on his way out since 2006, and there are no replacements lined up for him yet.
6. Sales have been declining for the past few years, with 2017 being another year with no growth in sales whatsoever
The company facts
Macy’s is the largest department store globally, with more than 500 stores nationwide. It’s also one of the best apparel brands in the United States.
Macy’s was founded by Rowland Hussey Macy and George T. Adams on October 28, 1858. The original store was called R. H. Macy Dry Goods and was located on Sixth Avenue in Manhattan, New York City.
The company has been around for over 150 years, but it might not last much longer, according to the rumors of Macy’s going out of business.
The employees’ facts
The most apparent sign that Macy’s going out of business is that it has been laying off employees. In 2016, it was announced that Macy’s planned to eliminate 10,000 jobs by the end of 2017.
These layoffs mainly affect their headquarters in Cincinnati and other central office locations. The changes at Macy’s also affect their online department. They have started to close down their store websites and use a new Macys.com, all under one domain.
Would Macy’s going out of business hurt other retailers as well?
Would Macy’s going out of business hurt retailers? If yes, then it would most likely hurt other retailers as well. Macy’s is the largest department store globally and has been around for a long time. It’s also one of the top five clothing brands in the United States. They could be on their way out soon with all that being said.
Conclusion
Rumors and speculation are swirling around Macy’s, but there is no conclusive evidence to say that the company is going out of business.
While Macy’s has expressed that it does not intend to go out of business, it has been actively closing down underperforming stores since 2020. As part of its growth strategy initiated in 2020, Macy’s aimed to shut down more than 125 stores in the coming years.
However, the company said it would open more stores and add more jobs. So, according to the company, no, there’s no question of ‘Is Macy’s going out of business?’
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