Struck hard by weak holiday sales, Macy’s this week will cut about 2,300 management jobs and consolidate three regional divisions in an effort to reduce costs and boost sales.
The moves come as the department store chain on Wednesday said it had a larger than anticipated drop in sales in January. Macy’s said same-store sales fell 7.1% last month
The job reduction would bring Macy’s work force to about 188,000, the company said.
The reorganization plan also calls to consolidate Macy’s seven regional headquarters into four. The Minneapolis unit will be absorbed into New York, St. Louis will be merged into Atlanta and Seattle will fold into San Francisco’s offices. As a result, the retailer plans to set up smaller regional offices in Chicago, Cincinnati, St. Louis, MO, and Seattle catering to local tastes.
That effort, called “My Macy’s,” is designed to boost sales in existing locations by offering customers unique shopping experiences and merchandise selection to custom fit their needs.
“Improving sales and earnings performance requires innovation in engaging our customer more effectively in every store, as well as reducing total costs,” said Terry J. Lundgren, Macy’s, Inc. chairman, president and chief executive officer, in a statement “We believe the right answer is to reallocate our resources to place more emphasis and talent at the local market level to differentiate Macy’s stores, serve customers and drive business.”
Macy’s Miami, FL, and New York Bloomingdale’s divisions were not impacted by the reorganization.
The company also said it plans to reduce its expenses this year by about $600 million by about $100 million a year beginning in 2009.
Macy’s acquired May in 2005 for $11 billion and converted the stores, including Field’s and Filene’s to Macy’s last year.
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