Macy’s (NYSE:M) on Tuesday said it will open up to 30 smaller stores in strip malls over the next two years, as the retailer chases customers out of dying malls and into bustling suburbs.
The company did not announce locations, but said the additional stores will start to open next year.
The expansion marks an inflection point for the department store operator, which has looked for ways to refresh its legacy brand, cope with dwindling mall traffic and compete with retailers that have stolen away shoppers. Macy’s has faced even more challenges in the past six months, as middle-income Americans — who drive most sales at its namesake stores and website — watch their spending and rack up debt on their credit cards. The company cut its full-year forecast this summer and expects weak sales to persist.
Chief Stores Officer Marc Mastronardi said small-format stores are part of the solution. Macy’s has tested the shops, which are roughly one-fifth the size of its traditional mall stores, for nearly four years. The stores offer a slimmed-down mix of merchandise, host local events, and have a more modern and open look. Plus, they’re next to big-box stores, grocers and popular off-price retailers like TJX-owned T.J. Maxx (NYSE:TJX).
M shares captured 12 cents, or 1%, to $11.67.
