Macy’s is Closing
By,
Megan Willborn
Macy’s has been in business since 1858, and is one of the oldest stores the U.S has to offer. The store’s long run history all began with $11.06 in sales, and led to becoming one of the world’s largest retailers. However, it's all coming to an end. Macy’s has been struggling for a while ever since 2015. Online shopping has dominated the retail market, pushing brick-and-mortar businesses out of it’s way. Since then they have closed more than 100 stores across the nation resulting in over 5,000 jobs loss. 11 of those are expected to close this year in 2018. That is 15% of all their stores.
Amazon surpassed Macy’s stock in 2015, and stayed on top The internet age has left American’s without a need to go to stores anymore. Everything they need can be sent by drones to their doorsteps. Look at these graphs. Macy’s is nowhere close to amazon's profits. Amazon has managed to surpass Macy’s stock in 2015, and ever since has been on top. This shows how the online era is making brick-and-mortar businesses worry. Through the century, businesses showed their growth as a company by building more stores. Now, that is meaningless when a entire store can be compacted into a website. Lately many large retailers have been closing their stores due to the rise of the internet age.
Macy’s is not done for however. The retailer is worth $6.4 billion, but owns more than $16 billion in real estate. They have been slowly selling off parts of their estate ever since 2015. Even though it may seem terrible for the company to e selling off parts of their business, they are saving over $300 million in annual expensive. By shutting down stores early, Macy’s saves money and it helps them transition more quickly to becoming a online market.
Sources:
Bowman, Jeremy. “Why Macy's Is Closing Even Profitable Stores.” The Motley Fool, The Motley Fool, 21 Jan. 2017
Thomas, Lauren. “Here Are the Stores Macy's Is Closing Next.” CNBC, CNBC, 4 Jan. 2018
The fact that Macy’s is closing is true for many department stores. These departments stores used to be where everyone shopped but now they are being put out of business because of online shopping and the convenience that it brings to customers. According to the article, the stock of Macy’s has gone down dramatically and is losing jobs very fast. The overall cause of Macy’s going out of business is the the online shopping and that customers can order something and it ends up at their front door and all they have to do is lift a finger.
ReplyDeleteI think this article can be related back to Toys R Us, as an example of a store struggling to compete with the newer online retailers. Today, people don't want to get up and drive to a store when they can simply look at products on their phones or computers. If companies don't adapt and readjust their business to accommodate for people's laziness its only a matter of time before they begin to lose money.
ReplyDeleteI do wonder if Amazon is a true competitor to a primarily clothing store like Macy's. While I don't shop for clothes too frequently, I can honestly say that I have never gone to Amazon to search for clothes instead favoring sites that specialize in clothing. Your point still stands though that Macy's is likely losing it's business to the online market, especially if they haven't specifically focused on driving up their online business.
ReplyDeleteThis is crazy. I don't think that people really realize how other businesses are affected once there is a newer better product. Even though there are new things are coming out and people are more drawn to them you never stop to think about how other companies might suffer. It is like Toys R US, no one really thought they'd ever close because they've always been well known and a great childhood memory for most of us but new companies and ideas have blown them out of the water. I think that a lot of businesses will start to close down because of amazon and other uprising companies.
ReplyDeleteI had no idea that Macy's was open for that long, opening in 1858 and lasting this long is a big deal, now a days most company last 5 or so years before they shut down, because they can't proved what that people want. once that happened's there sales go down and people have to shut down. But to make it and last 160 years that's insane. Being open that long and being able to make it is this long is really cool, because they proved new things every year to keep them going, and because they lasted that long it sucks to see them go.
ReplyDeleteThis is the first time I have heard about Macy's closing, yet I am not surprised. Along with Macy's, Boston Store is also shutting down all stores. Although I am not sure of the reason, I am assuming that online shopping has a lot to do with this. Technology is getting more and more advanced, and delivery time can now be as quick as the day you order something. People like the convenience of not having to leave their house to find what they want. I do think it is smart for Macy's to start selling their property now so that they don't end up losing a lot of money in the end. It will be interesting to see how many Macy's shut down within the next couple of years.
ReplyDeleteI am not a big shopper, online or at stores, but I definitely see why this is happening. It is so much easier to order something on Amazon and have it delivered the next day on your doorstep. It makes it much easier for people with busy lives and a lot more convenient. The only thing I wonder is how many of these Amazon products have to be returned. The advantage of going to the store is that you are actually able to try the products and see how they look in reality, compared to online shopping where you just have to guess the size and quality. Maybe one day people will want to shop in-store once again, but until then, Macy’s is making the right move in closing their stores.
ReplyDeleteI noticed that more and more department stores are closing down, like Boston Store and now Macy’s. It is interesting how times have changed when it comes to shopping because a few decades ago department stores were all the rage. Now with Amazon being able to ship everything and having everything all in one place, it is hard not to shop online. The reason these stores are closing down is because Americans are lazy and don’t want to get off of the couch. Luckily, Macy’s is still able to keep stores open because of all the real estate they have along with the billions they are still raking in. Hopefully this long standing department store won’t follow their department store counter parts down the drain.
ReplyDeleteIt’s never good to see a business that’s been doing so well for so long fall, but with the internet and online shopping constantly rising it only makes sense. I think what’s holding them back is that they aren’t accommodating to their customers. Amazon is so popular today because they continuously do what customers ask and make doing business much easier. This helps bring in revenue for Amazon much easier than it is for Macy’s. Besides this, it was also interesting to see the stock comparison. Amazon is much higher than Macy’s (by 1,500) and is only going up. Whereas Macy’s is at a low stock price and has been fluctuating, mostly downward, over the past few quarters.
ReplyDeleteI wasn’t really surprised to hear that once popular shopping centers such as Macy’s are starting to shut down and make way for new businesses. The internet like you have said is a large part of today’s world and shoppers simply are no longer highly interested in what Macy’s has to offer. Many teens and young adults buy things from other retailers which is driving Macy’s out of business, but Macy’s has had a good, long run, however all good things eventually come to an end.
ReplyDeleteIt is crazy how much of an impact of making our world more advanced can harm businesses. Luckily Macy’s has realized a decline in revenue and has been trying to make changes before everything crumbles. If they are able to make a successful online store, they may have a chance at surviving. However, there are so many online stores nowadays that it is hard for new businesses to transfer over.
ReplyDeleteBecause so many of the Macy's stores are beginning to shut down is it the stores that are failing or the company itself? Also, what about all of the other companies that Macy's is affiliated with like Bloomingdale's? Would those stores all shut down too or is that company all on their own and continuing to make a growing profit unlike Macy's? It's not surprising how much online shopping is affecting real stores, the internet and technology continue to progress and will continue to become more advanced continuing to push other stores like Macy's off the market.
ReplyDeleteJust like Macy's, many other department stores are starting to shut down. Not only is the world of online shopping taking over but, people are starting to stray away from department stores in general and sticking to other shops in malls. Department stores tend to overwhelming to lots, which makes sense considering online shopping is simple, there is not pressure to buy anything and nobody is trying to convince you to try this or that. So I believe this does not come as a surprise and will likely happen to other stores in the future.
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteMacy’s is a part of an oligopoly, that is, there are a few firms that dominate the market, with a high barrier to enter the market. Alongside Macy’s there is Nordstrom, Boston Store, and a few others that run a similarly styled department store. However, while the competition is doing well, Macy’s is struggling. It also makes sese that in a technology flooded world, stores are closing because of online shopping.
ReplyDeleteAs more upscale department stores pop up around the country like Nordstrom and Von Maur, the stores that have been around for years like Macy's, Sears, and Boston Store are being shut down. However, the updated department stores are not the only reason these stores are going out of business; the main reason for this is that online shopping is growing. Since people can now shop in the comfort of their own home, way less people are going to stores, causing them to take in much less money, putting them out of business.
ReplyDeleteI am not surprised but also mildly surprised to hear that Macy’s is closing. As you said, the demand for physical stores is decreasing as the demand for online stores go up. However, I feel like Macy’s supplies to a certain consumer profile in which I thought demand for the store would stay high. Macy’s is a huge corporation so I’m mildly shocked that it took such a turn. What will happen to the Macy’s Thanksgiving Day parade?
ReplyDeleteIt is very interesting that their real estate is worth more than the business as a whole. Is Macy’s transitioning to an online retailer, or just going to keep selling off until they close? The fact that they are even closing profitable stores is very peculiar, because why would you close a store that is making profits?
ReplyDeleteI think it’s sad to such old and long-running businesses like Macy’s, Boston Store, or Toys R Us closing this year, but because these stores didn’t keep up with the consumers’ demands, they couldn’t make enough revenue to remain in business. Although Macy’s has enough money to keep some of their stores open, they won’t remain in business for much longer because online stores like Amazon, continue to dominate over the retail market. Macy’s won’t be able to keep up with Amazon because it’s so popular.
ReplyDeleteThere are many reasons why Macy's was making much less money than Amazon, one of the greatest being is that Amazon has much less overhead costs compared to Macy's. Macy's has to pay for buildings, employees, product, while while Amazon has nowhere near as much real estate no where near as many employees, and doesn't really have to pay for their product.
ReplyDeleteWhile you are correct that Amazon has less real estate, a quick search reveals that Macy's has about 130,000 employees compared to the 556,000 that Amazon has. A seller on Amazon gets paid for what is bought, and is given money from purchases of their product.
DeleteI think that it really isn't that much of a surprise that shops like Macy's are having difficulties competing with online giants like Amazon. While I realize that there is an online presence for stores like Macy's and other retail giants, I believe the versatility of companies like Amazon and Ebay are ultimately going to be very hard to compete with. The only thing that I could really seeing Macy's and other similar stores having an advantage with would be in the realm of physically trying out clothes before buying them.
ReplyDeleteI’m actually surprised Macy’s is closing. It seems that most, if not all of the old stores are closing down. It’s amazing that online stores have overcome almost every old store. Amazon seems to continue to dominate every store online and not online, but why can’t the old stores make websites? Either way, it seems like they are doing pretty well knowing their closing. Perhaps closing stores down earlier is the best way to go to build up their revenue again.
ReplyDeleteIt does not surprise me in the slightest that stores such as Macy's are closing down as amazon grabs higher and higher portions of the market. We've seen this from a mile away as amazon attracts more and more customers, using the convince of buying things from your own home as well as savings from cutting out the middle man.
ReplyDeleteI find it sad to be losing a piece of classic American history: A place to go with multiple departments, areas to explore, and choices - all gone. I also think about how a closure of this scale affects the choices available for people and how it could horribly limit their overall choices, and may drive prices for specific goods up dramatically, which is never great for the economy.
ReplyDeleteA lot of stores like Macy's are closing, like Boston Store. Amazon has attracted the attention of many consumers because of how easy it is to find exactly what you want without much effort. These stores just arent getting enough business to cover the expense of their rent, electricity, and other fixed costs.
ReplyDeleteThis is really surprising to see Macy's sustainability throughout the centuries being impacted by the internet age. However, I agree with their decision to sell parts of their real estate in order to keep the main functions of their company stable. Also, by selling stores in smaller markets, they are able to keep their main stores stable such as the location downtown Chicago that's a landmark.
ReplyDeleteIt’s interesting to see how the internet age has taken down even the largest department stores such as Macy’s. While it is not surprising, it is incredible to think that something so popular could one day disappear. I think that they’re decision to close some of the smaller stores is smart, as the potential benefit outweighs the opportunity cost of losing just a couple of customers.
ReplyDeleteIt's interesting to see the internet and online shopping actually closing stores by taking all of their customers. We all knew it was inevitable, but with Macy's and Boston Store closing we are actually able to see the loss of business and how it effects the retail stores. We used to say that "In the future everything will be online.", but suddenly that future has come.
ReplyDeleteBecause so many of the Macy's stores are beginning to shut down is it the stores that are failing or the company itself? Also, what about all of the other companies that Macy's is affiliated with like Bloomingdale's? Would those stores all shut down too or is that company all on their own and continuing to make a growing profit unlike Macy's? It's not surprising how much online shopping is affecting real stores, the internet and technology continue to progress and will continue to become more advanced continuing to push other stores like Macy's off the market.
ReplyDeleteI think that was a very interesting comparison in it cool to see a side by side of a popular store such as Macys and an online store such as amazon. The online industry is truly taking over the retail world. I personally work at a retail store and have seen first hand the effects of online shopping because the internet is such a large platform people are able to get a wide range of prices allowing for more informed shoppers and better priced good that is why it is so much more popular than in store shopping however many stores still get a lot of foot traffic as people will try on different brands for sizing before purchase it is just a matter of time until sizing can be done from home and the retail world will slow to a stop.
ReplyDeleteThis is crazy! Boston Store is going out of business as well. Us millennial are killing the retail business with all of our online shopping with the internet and such. It will be interesting to see what will happen to those retail buildings now that they are going out of business. Maybe we will see an increase in indoor swimming facilities. I don't know though, I'm not an executive or anything.
ReplyDeleteSears and KMart are singing the same sad tune as more and more companies fall under the pressure of the internet age. For these companies, the read the signs of a changing preference of shopping too late. Either that, or it was just a matter of luck. Walmart, for example, was able to address the demands of the current society, promoting internet shopping, and providing cheap groceries. They were able to recognize what people wanted and what was no longer desired.
ReplyDeleteSince Macy's is a bigger store it comes as a show that such an old and large business can end. Smaller businesses on the other hand experience the scariness of going out of business daily, so how does the effect of large businesses ending change things for small businesses? Will this cause more people to shop in the boutique style pricier stores when going on that "shopping spree". If so, how will that impact the economy, as it is putting more money into the families instead of corporations, so in theory this could start a whole new line of big companies.
ReplyDeleteI think it's very interesting how evolving times can make such a big difference in today’s economic. Now a days we think of how much social media and the internet has improved our lives, but we really don’t think about the negatives. I guess it’s something to think about now and then about how something that’s made our life so much better can wipe someone else out of business. I also find it interesting to look at just how much amazon has swiped the sales of almost every business because it is just so much more convenient. Really shows you how lazy our generation is!
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