Macy's (NYSE:M) announced that it will close 14 stores and cut jobs in early spring of this year. The company will shift its focus to the omnichannel retail approach, which includes Macy's popular click-and-collect and ship-from-store store services.
While some employees will be laid off, the workforce numbers will remain almost the same as the company expects to hire 1,500 associates to work in its direct-to-consumer fulfillment center in Oklahoma starting in April, reported Reuters.
Click-and-collect services have gained popularity at Macy's and Bloomingdale's stores. The service was first piloted back in March, along with same-day delivery. And just prior to the holidays, the company announced an expansion of its same-day delivery and in-store pickup options to more locations around the country.
"Our business is rapidly evolving in response to changes in the way customers are shopping across stores, desktops, tablets and smartphones. We must continue to invest in our business to focus on where the customer is headed–to prepare for what's next," said Terry Lundgren, Macy's chairman and CEO. "Macy's, Inc. has benefited in recent years by having invested early and aggressively in our M.O.M. strategies (My Macy's localization, omnichannel integration and magic selling customer engagement). This has included talent, technology, omnichannel infrastructure and fulfillment capability."
Lundgren continued to explain that the changes would better assist the company in meeting customer demand, avoiding redundancy, and accelerating the speed to market.
On a local level, changes include discontinuing planner positions and reinvesting in new regional teams devoted to specific themes and merchandise localization.
The restructuring is expected to save about $140 million per year, reported Reuters.
The company announced back in 2013 that it would build a fulfillment center in Tulsa County, Oklahoma, to ship more orders to customers in the central and southern United States.
"Our omnichannel strategy depends on great Macy's and Bloomingdale's stores that not only welcome shoppers through the door and deliver an outstanding shopping experience, but that also fulfill orders that are shipped directly to customers around the country. In 2014, about $1 billion of Macy's and Bloomingdale's direct-to-customer shipments originated from Macy's and Bloomingdale's stores. Moreover, our process for buy online pickup in store has established a new dimension in customer access and convenience," Lundgren said.
-See this Reuters article
-See this Macy's press release
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