What: Macy's accelerates its transformation plan by increasing store closures to 65 locations by January 2025, while reporting a 2.4% decline in Q3 net sales amid an internal financial investigation.

Why it is important: This development reveals the mounting pressure on legacy retailers to expedite their transformation efforts, even as they grapple with financial transparency and the need to protect core business performance.

Macy's has announced an expansion of its store closure strategy, increasing the number of locations to be shuttered from 50 to 65 by January 2025. This decision comes as part of CEO Tony Spring's "Bold New Chapter" strategy, which aims to revitalise the company through strategic downsizing and operational modernisation. The announcement coincides with Q3 financial results showing net sales of $4.7 billion, representing a 2.4% decline from the previous year. Despite these challenges, the company reported positive comparable sales trends and growth in women's advanced contemporary apparel, beauty, and digital products. The retailer is also managing the fallout from an internal investigation regarding $151 million in hidden delivery expenses over a three-year period, though the company maintains this had no impact on cash management or vendor payments. This complex situation reflects the broader challenges facing traditional department stores as they navigate both structural transformation and operational oversight.

IADS Notes: Macy's accelerated store closure plan, increasing from 50 to 65 locations by January 2025, reflects broader trends in retail transformation observed throughout 2024. As noted in November 2024, the company's "Bold New Chapter" strategy demonstrated early success through its "First 50" pilot stores , showing how targeted investment in remaining locations can drive performance improvement. The strong demand for Macy's real estate assets, reported in August 2024, benefits from a low U.S. retail vacancy rate of 4% , indicating continued value in prime retail locations despite operational challenges. This strategic pivot comes at a crucial time, as Forbes revealed in May 2024 that department stores now capture only 2.6% of retail transactions, down from 14.1% in 1993 . The recent internal investigation into hidden delivery expenses further emphasises the complexities of managing large-scale retail transformation while maintaining operational transparency and financial discipline.

Macy's to close 15 more stores than planned, total of 65 to shutter by end of January 2025