Thursday, January 7, 2016

Macy's Announces Layoffs, Lists 36 Store Closures

Macy's has announced it will eliminate more than 4,500 positions as part of a restructuring plan. It is also in the midst of closing 36 stores, first announced last year, which will affect another roughly 2,600 employees

The announcement of the 4,500 additional  cuts comes as Macy's suffered a significant sales decline during the holiday season. Sales in November and December at stores open at least a year fell 4.7% from 2014. That loss contrasts with holiday spending overall, which was up 7.9% for the season, according to figures from MasterCard SpendingPulse.

The poor performance by Macy's doesn't come as a surprise to me. As I already reported. I, personally, had a terrible experience over the Christmas season at Macy's. (SEE: Has Macy's Gone Mad?)

But aside from my personal experience at a cash register, the entire experience was pretty boring. With online sales continuing to gain a greater and greater part of consumer spending, a trip to a department store needs to be made super exciting or people aren't going to do it.

There was none of that kind of excitement and energy at the Macy's in Union Square in San Francisco. It was almost as if the employees were just going through the motions. "Oh yeah, it Christmas, Let's put out some Christmas sales signs."

I speak from a tiny bit of experience. While going to college, I was a manager in a department store that was eventually taken over by Macy's. I was thje manager of the electronics department and the sportings goods department.

During my period as manager, I blew sales through the roof in both departments. In electronics sales were up 130% and in the athletic department they were up 70%. These were huge jumps. No one else in any department in any location came close. One thing I did in electronics was to arrange the stereos etc. in a manner that would drive people to the one I had plenty of in stock of and that I though was the best deal.

The department had salespeople but I reasoned that if I could present the stereos in a logical fashion so that the customer knew what the best  deal was the sale would be that much easier.

It was kind of magical for me to watch customers look at the stereos and the price tags and end up at just the stereo I wanted them to end up at.

Another thing I did was at a feature spot where a stereo was to be placed, I went to the arts department and took out on an in-store consignment of this very cool looking abstract painting. It kind of looked like a sophisticated picture of blowing desert sand. I put the picture above the featured stereo spot, where I positioned the most expensive stereo, and then I had the spotlight shine  on the picture instead of the stereo. In my mind it looked super cool. It was like there was a sun rising in the desert picture.

My thinking was a spotlight on the stereo was just telling customers, "Hey, buy this." in typical hustler manner. With the spotlight on the picture, it became a mood thing, "Hey, this is the cool spot."

I cam remember the store general manager walking the department with me a week or so after I had put the picture up. He looked at it long and hard and said to me, "If you sell any of those stereos, I may let you keep that up there."

We blew through the roof selling those stereos.

I also did some real creative stuff with clothes racks to create this Bam! an in your face presentation of  football jerseys.

I could go on, but the point is I didn't see any of this going on at SF Macy's. It was like no one working at the store understood excitement. In the short while I was in the store I noticed at least a dozen things that should have been done to create excitement.I'm talking about major league excitement well beyond what I did in my tiny departmetns, but I didn't even see the tiny department stuff going on.

It's like the store was being run by a bunch of quants who probably don't even wear matching underwear.

I don't think the 36 stores closed by Macy's this year will be the last.

The list of Macy's stores set to close is here.



  1. For our wedding, my wife and I received over a thousand dollars in Macy's gift cards. With it, we intended to buy a couch. Se we went online, chose a couch, and.... you can't order online. You have to call in, and they painstakingly enter all of your information into their computer. What would have taken me 5 minutes online took 35 minutes on the phone. I was annoyed. At the end of the conversation, I put the order on hold so I could make sure the wife was ok with the color. So we hung up, after I was assured my order would be ready to go.

    The next day, I called THE SAME ASSOCIATE back, and she told me their computer system had a problem (the second time she mentioned it in our discussions) and that I'd have to give her all of the data again! Another 25 minutes. What a complete waste of my time and that woman's labor. It is like the place is run by Paul "The Internet Is Just A Fad" Krugman. Completely nuts.

  2. I like going to Costco for the samples. Maybe Macy's should start offering food samples?

  3. I currently work for the largest retailer in the world, and successfully turned 4 of my store's worst departments into the best over 11 months, taking YTD sales from -7% YOY to +15% and driving down the inventory ratio by 22%. As a result I was featured in an internal commercial for a major company meeting and was quickly promoted. I didn't even get a chance to do many wow features as you mention. It is incredible to me the condition of retail stores in general. There is so much opportunity. I assume the biggest reason for this is that it is hard to find really good workers these days. Too much of an entitlement, lazy, anti-business attitude out there. Great job, government schools.

    1. I wouldn't just blame workers or government school. The model of creating human resources for companies that government schools were built on is alive and well today. Creating non-questioning employees who do what they are told, nothing more, nothing less.

      The problem in my experiences is the reward and recognition system at some companies. It just hasn't been there for adding to the bottom line. It's there for playing politics and crafting one's image and perception but just for working smart and/or hard to add to the bottom line in a major way? No. And since that means risk of failure and punishment well most people begin to realize they don't get anything out of it to even try. There's no upside, just downside. That's the message companies send through their cultures. Employees figure out the company pays them to be there and do what they are told, so that's what happens. That sort of thing encourages working as little as possible and never doing anything above and beyond.

      If results were rewarded in and of themselves I could still be at the corporation I started working for out of school today. Just in my last project there I saved the corporation probably twenty million dollars over the product's life. Instead well I'm long gone and the company is a shadow of its former self. The division I worked in has been sold off and then sold a couple more times and raided for the intellectual property created by the talented employees it didn't treat well. So it goes. The free market ultimately punishes this sort of management and that company is in an industry that's largely free market so it got punished.

    2. I agree the reward/recognition systems overall is in need of improvement and tied more closely to results rather than hours worked- I'm sure a lot of people would not have had the patience that I did for much of my unrewarded or unnoticed work to pay off. You can't even get merit raises in my company, you have to wait a whole year and the raise is usually one of two options about 10-20 cents apart. That pretty much forces you to move up in the company (which I'm happy to do), but what if you just wanted to be the best cashier or department manager in the company? You would have to wait years for your pay to build up while you are surrounded by lousy workers making far more than you because of all the time under their belt.

  4. I figured that “our” Macy’s at Eastland Mall on Eight Mile would be on the “closed” list. I was wrong.

    1. After posting this, I talked with a woman who works at the Eastland Mall Macy's hair salon who said they were all amazed that their store was not on the list. I guess this means that the stores they are closing are in even worse shape.

  5. This is a perfect example of how young people lose opportunities when the minimum wage prices them out of markets and their jobs are taken by computerized kiosks, etc. et al

    It's nice to see that you still think fondly of those days working retail- I'm sure those times gave you some skill sets you still use today even though you moved into other careers and garnered more skill sets.

    I know my time in both retail & the restaurant industry was very valuable in helping me build on more skill sets down the road and different career paths, and I too look back on those days fondly.