Macy’s, the famous New York-based retailer, is planning to close another 86 stores as part of a big turnaround plan. The company has also lowered its profit forecast for 2025 because of tariffs and concerns about shoppers spending less.
How Macy’s is Responding to Tariffs
Macy’s Chairman and CEO Tony Spring shared four main steps the company is taking to fight the effects of tariffs on goods imported from China. These steps include sourcing fewer products from China, negotiating better deals with suppliers, getting discounts from vendors, and canceling or absorbing cost increases.
Spring told Wall Street analysts that with uncertainty about how tariffs will affect customers, Macy’s is preparing for more careful spending from shoppers this year.
Price Increases and Store Changes
Adrian Mitchell, the company’s outgoing Chief Financial Officer, said Macy’s will raise prices on some brands and product categories, but they want to keep offering good value to customers.
As part of its plan, Macy’s has already closed 64 stores and will close 86 more by 2027. They have sold some store properties and earned $16 million from these sales.
The retailer has also improved 125 “reimagined” stores with better product choices and more staff, which have been doing better than other locations.
Financial Outlook
Macy’s reported a 5.1% drop in net sales during the first quarter, reaching $4.6 billion. The company expects to make between $21 billion and $21.4 billion in sales for the whole year.
Retail expert Neil Saunders said these numbers aren’t too bad, especially since the sales drop includes stores being closed. Macy’s luxury brands Bloomingdale’s and BlueMercury actually saw sales increase.
Saunders noted that Macy’s may not grow much in the near future but won’t be struggling at the bottom of the retail market either.
Plans for Discounts and New Products
CEO Tony Spring said Macy’s will offer discounts on some spring products that arrived late to keep new items available through summer and into the holiday season. This may reduce profit margins but should help sales.
Macy’s is also changing its product range, canceling or delaying some orders from China due to tariffs. This means shoppers might not find all their usual favorite items in stores.
Macy’s is facing challenges from tariffs and changing consumer habits but is taking steps to adapt by closing stores, raising prices selectively, and adjusting its supply chain. While sales have dropped, the company is working hard to improve stores and stay competitive in the retail market.