Macy’s is accelerating its plan to roll out smaller stores that are unattached to malls.
The department store retailer announced on Wednesday that it will open three new off-mall, small-format stores this fall. The news comes as Macy’s leans into a strategy that involves expanding locations of its off-price Backstage stores as well as Market by Macy’s concept, a smaller-format outpost spanning approximately 20,000 square feet compared to the retailer’s usual 200,000-square-foot spaces.
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In August, Macy’s will open its third metro-Atlanta area Market by Macy’s location at Johns Creek Town Center, located at 3630 Peachtree Pkwy., Suwanee, GA. The chain will also open a Market by Macy’s in the St. Louis, Mo. area. Finally, a dual Market by Macy’s and Macy’s Backstage store concept, the first of its kind, will debut this fall in Chicago, Ill.
These changes are part of the company’s plan to rework its retail footprint to focus on off-mall locations. Part of this plan, which was outlined in 2020, includes closing a total of 125 stores in lower-tier malls by 2023. Since rolling out this plan, Macy’s has opened up five Market stores and expects to have eight total by the end of 2022.
Since 2015, Macy’s has expanded its Backstage concept to more than 300 stores, including 9 freestanding stores. In March, Macy’s announced the rollout of 37 additional Backstage store-within-store concepts.
“As customer preferences and buying behaviors change, we continue to evolve to deliver the experience our customers expect,” said Marc Mastronardi, chief stores officer at Macy’s in a statement. “As exciting brand extensions, Market by Macy’s and Macy’s Backstage each offer unique shopping experiences — one celebrates discovery and convenience, while the other appeals to the customer who loves the thrill of the hunt for a great value.”
Other department store retailers have also announced plans for smaller, more-efficient store locations in recent years. Target recently announced a plan to open 30 small-format to midsize locations across city centers in the U.S. throughout 2022, to further engage with consumers in various neighborhoods. DSW has also rolled out a revamped store of the future “Warehouse Reimagined” model which consolidates the retailer’s 20,000 to 25,000 square foot-stores into more efficient 15,000 square-foot locations. Kohl’s also recently announced a plan to open 100 new, smaller format stores in markets previously untapped by its physical presence over the next four years. At the same time, Morningstar analysts identified 10 Kohl’s properties with leases set to expire before fiscal year 2023, which could potentially result is some store closures.
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