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Macy’s Herald Square Project Working to Avoid Apocalypse

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By: Sorita Menendez

Macy’s Incorporated is struggling.

In trying to work its way out of the doldrums, however, it is meeting resistance on Manhattan zoning changes that need to be approved by City officials. The historic retailer announced that wants to build a 1.5 million square foot building on top of its classic store in Herald Square, politics, together with rules and regulations, however, may stall that move.

It was last April when the news broke that the company wanted to build the 1.2 million square foot Tower. Officials were said to be seeking zoning alterations that would permit it to build an 800-foot edifice. Some in the city council complained does the body was not notified by Macy’s before the plan was released to the public.

Shares of Macy’s stock fell by an estimated 43% last year, and top brass has announced it will be closing as many as 125 stores and eliminating mm jobs in an effort to compete with online retailers.

“Before approving a zoning changes, the city could ask Macy’s for concessions, like transit upgrades at the busy Herald Square subway station. That could delay the project, according to Caroline Harris, a New York City land use attorney,” noted Crain’s New York Business.

On February 4, the retailer announced an updated strategy and three-year plan designed to stabilize profitability and position the company for growth.

“We have a clear vision of where Macy’s, Inc. and our brands, Macy’s, Bloomingdale’s and Bluemercury, fit into retail today. We are confident in our Polaris strategy, and we have the resources required to return Macy’s, Inc. to sustainable, profitable growth,” said Jeff Gennette, chairman and chief executive officer of Macy’s, Inc. “We will focus our resources on the healthy parts of our business, directly address the unhealthy parts of the business and explore new revenue streams. Over the past three years, we have shown we can grow the top-line; however, we have significant work to do to improve the bottom-line. We are confident the strategy we are announcing today will allow us to stabilize margin in 2020 and set the foundation for sustainable, profitable growth.”

He added, “We are taking the organization through significant structural change to lower costs, bring teams closer together and reduce duplicative work. This will be a tough week for our team as we say goodbye to great colleagues and good friends. The changes we are making are deep and impact every area of the business, but they are necessary. I know we will come out of this transition stronger, more agile and better fit to compete in today’s retail environment.”

The company is focusing on building customer lifetime value, accelerating personalization and monetization programs and expanding its loyalty program, it said in a release. This includes the launch of the next phase of its already successful Macy’s Star Rewards Loyalty program later this month. Loyalty 3.0 is expected to increase the engagement of occasional Macy’s customers and to bring new customers into the brand.

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