Macy's Sales Down, Will Eliminate Former Marshall Field's Headquarters, Fire 2,550

Macy’s sales are down and the retailer says they will begin restructuring, according to the Chicago Tribune:

Macy’s Inc. plans to eliminate the former Marshall Field’s headquarters in Minneapolis and cut more than 2,000 jobs as part of a move to consolidate regional offices and boost sales and cut costs.

In the closure, Macy’s North chairman and CEO Frank Guzzetta, 62, a former Field’s executive who has been focused on reviving the State Street flagship in Chicago, will retire in the spring as the division is melded into Macy’s East in New York.

The department store chain said the restructuring will eliminate about 2,550 workers and save about $100 million a year starting in 2009.

Macy’s same store sales were down 7.1 for the fiscal year and overall sales were down 28.4 in January.

UPDATE 1-Macy’s same-store sales down, plans job cuts [Reuters]
Macy’s to eliminate Marshall Field’s headquarters, consolidate regional offices [Chicago Tribune]
(Photo:Sarah606)

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  1. laserjobs says:

    Hello deflation.

    Note to retailers: Everyone is tapped out after the credit spending orgy. Sorry but that $600 taxpayers advance will probably go to pay off some bills.

  2. Crymson_77 says:

    Had they not gotten themselves in this position in the first place, it wouldn’t be a problem….but NOOOOOOO they just had to buy f-ing EVERYONE and turn them ALL to crap…

  3. Crymson_77 says:

    Vis-a-vis…this is a downward spiral and we can only hope that they go out of business after being so stupid…

  4. velvetjones says:

    So this means that their strategy of shoving crappy private label merchandise down our throats didn’t work? Shocking.

    I’ll be thinking of them when I spend my hard-earned economic stimulus check at Nordstrom.

  5. Bay State Darren says:

    I swear to no specific God, I forecasted this just this past Saturday! My mom and I went to a Macy’s in metrowest Mass. that day to get buy shirts, etc. for a certain local football team participating in the year’s biggest sporting event the next day [please: nobody threadjack here to pick on the Pats, it’s irrelevant and unneccesary.] We couldn’t find anything and asked a salesperson. He said that they had none and had not recieved any in a while, despite obvious demand. While maintaining professionalism, he seemed to be as suprised by this fact as us.
    I said after leaving that Macy’s would probably be reporting financial woes soon because of the mismanagement that leads to decisions like this. All the other clothing stores in the mall had Patriots gear and it was definitely selling.

  6. Greasy Thumb Guzik says:

    That was actually the Dayton-Hudson HQ up north. They just changed the name when Dayton bought out Field’s, but before the company name was changed to Target.

  7. millcitymodern says:

    Macy’s in DT Mpls had crazy markdowns last week. I got my husband 12 items of clothing, including 4 cashmere sweaters (originally $160/each) for under $200.00. Ridiculous!

  8. socalrob of the 24 and a half century says:

    Macy’s is an over priced Sears now. Minus the only good part of sears AKA major appliances and tools. I admit I shop at macy’s but only for cologne and when I need a nice watch. But then those times are only when they have special sales like x% off with using macy’s card. And then the Macy’s card gets paid off and put away for another year.

  9. JiminyChristmas says:

    A brief saga of Upper Midwest retailing for you:

    The traditional department store in Minneapolis used to be Dayton’s. It was founded there and it was a well-liked and respected local/regional brand. Dayton’s was then bought by Marshall Field’s. The public was pretty chagrined about it, but over the span of a couple of years people grew accustomed to it and actually came to like the brand.

    Just as people had reconciled themselves to Field’s, Macy’s, who had a 1-store presence in Minnesota at the Mall of America, bought them out. This reduced the major department store offerings in Minnesota from four to three. Nordstrom’s and Bloomingdale’s are the others, each with one store at the MoA. That left Macy’s with about 8 of the 10 or so major department stores in the Twin Cities area.

    Unpopular result #1: A lot of variety disappered from the market and what Macy’s tended to offer didn’t suit the area as the prior retailers did. Unpopular result #2: Judged against the old Field’s, Nordstrom, and Bloomingdale’s, the quality of Macy’s products is widely perceived to be the lowest of the bunch.

    Much moreso than the current downturn in overall consumer spending, I would attribute Macy’s problems to their parent company, Federated Department Stores. The Marshall Field’s takeover was botched from day one and they still haven’t figured out how to turn it around.

  10. GothamGal says:

    Free Lancome gift at Macy’s this week.

  11. yourbffjill says:

    GOOD. I just had a customer service nightmare with them that lasted an entire month. This is almost like sweet, sweet revenge.

    Well, it’s good except for all the people losing their jobs, because that sucks.

    Also this probably means that customer service e-mail response time will increase from the already appalling six business days that it currently is. However I will not be testing that out any time soon.

    Yes, I’m bitter.

  12. Midwest_Product says:

    God, I would KILL to have Dayton’s back in MN. Field’s wasn’t too bad, but Macy’s is utterly worthless. I’m hoping when they vacate the old Dayton’s flagship that Nordstrom will move in.

  13. Rando says:

    Just an fyi, no stores will be closing, only the Macy’s North, Macy’s Midwest, and Macy’s Northwest corporate offices. When Macy’s bought May Co, they ended up with a bunch of extra unneeded corporate offices… To be honest these should have went with the acquisition, but they didn’t.

  14. @Crymson_77: If they are so crap, there is room for competition. Maybe they are so crap because they are poorly organized and not realizing the synergy of large expansion yet.

    Nah, they’re just victims of a turning economic cycle.

    When it comes back, maybe consumerist brain trust can put together a competitor.

  15. bohemian says:

    @JiminyChristmas: Very accurate outline of retail up here. I am seriously considering saving up my clothing spending dollars and just making twice yearly shopping trips to Mpls so I can hit Nordstroms, Bloomingdales. I can’t begin to tell you how under-whelmed I am with Macys.

  16. velvetjones says:

    @Midwest_Product: I’m sure the 950 people out of their well-paying jobs would agree with you. Remember when it was a pleasure to shop there? I’ve been working in DT Minneapolis for years, and until Macys took over not a week went by without at least one trip to Dayton’s/Fields. Now, weeks pass and I don’t even miss it.

  17. spinachdip says:

    @PotKettleBlack: In an ideal world, yes, but I’m thinking mass market retail is an economy of scale, where size trumps funamentals and management quality.

  18. swalve says:

    @laserjobs: Deflation? You must mean inflation. Inflation is going up, the trend right now is for it to be nearly 4% this year. Higher than it has been since 1991.

    [www.inflationdata.com]

  19. Greasy Thumb Guzik says:

    @JiminyChristmas:
    You have it backwards.
    Dayton-Hudson bought Field’s from British-American Tobacco [don’t ask!]

    Dayton’s then changed the names of all the Dayton’s & Hudson’s to Marshall Field’s & changed the corporate name to Target Inc. Field’s had a national reputation & certainly a better rep than Hudson’s which was tainted by being in Detroit.

    Then Target sold all the department store to May Dept. Stores which sold them to Federated [Macy’s]. The Federated’s boss, Terry Lundgren who fashions himself as a retail genius, decided that if a single name nationwide was good enough for Wally World & Target, then Macy’s it will be.

    There will never be a bust of Lundgren in the Merchandising Hall of Fame, which is next to the driveway of the Merchandise Mart in Chicago, which was built by Marshall Field II.
    If there is ever a bust of Lundgren, look for it in a landfill in New Jersey!

  20. humphrmi says:

    @Midwest_Product: We’re with you on that sentiment here in Chicago, we’d kill to have Marshall Fields back. On behalf of Marshall Field fans everywhere in Chicago, we’re sorry for dragging you into this mess.

  21. El_Greco says:

    Soo, lemme get this straight. First, they buy out the more popular Marshall Fields, in hopes that the majority of customers (who greatly outnumber the macy’s patrons) will stay with on with Macy’s. Then, they start passing out crapware and snake oil on us, and then they decide to do away with Marshall Fields altogether? Seriously, whoever makes these decisions in the company should be given a dunce cap and have “I’m Stupid” tattooed on his forehead.

  22. Rando says:

    @bohemian: You do realize that Macy’s owns Bloomindales and the clothing in bloomingdales is extremely overpriced and low quality, just like nords… lol

  23. Rando says:

    @humphrmi: More like 2 dozen people would kill to have MF back. Some people just can’t get on with their lives.

  24. Rando says:

    @humphrmi: More like 2 dozen people would kill to have MF back. Some people really need to get on with their lives.

  25. Midwest_Product says:

    @RandotheKing: You’re right that no stores are closing as part of this announcement, but it’s inevitable that stores are going to be closing in the future. Bad brand image + poor sales + impending recession = store consolidation. And that’s to say nothing of how angry people in Minneapolis, St. Louis, and Seattle are going to be about this, where I’m sure sales will drop even further. I don’t know about the latter two cities, but I’ll wager the downtown Minneapolis location gets closed down.

  26. fredmertz says:

    @humphrmi: Marshall Fields (especially the State Street store) did nothing but bleed money for at least 3-4 years before Macys bought it. So obviously you and all those other Chicagoans who bitch about it going away weren’t doing a whole lot of shopping when it was around.

  27. JiminyChristmas says:

    @Greasy Thumb Guzik: Damn, I was just going by the signs on the stores.

  28. deadlizard says:

    I can’t understand Midwesterners. The only thing Macy’s changed from Marshall Fields was the name. I think they stopped going just because they hate another New York business taking them over.

  29. theblackdog says:

    I actually enjoy going to Macys, but because I already have all the clothes and housewares I need, my shopping there has fallen off.

    That’s what happens when I reduce clutter in my house, and reduce spending as well.

  30. nycdor says:

    Macy’s – My mom has worked at the St. Paul store (Daytons/Marshall Field’s/Macy’s for 25 years. Even though it’s never as good as it was when it was Dayton’s, please don’t close it!! K thx.

  31. DjDynasty says:

    @deadlizard: WRONG! They cut commissioned sales staff with salaried teenagers. Try finding help in best buy?! You can tell Target was founded as a department store, their commitment to service still shows. When you pick up the phone to page for a team member, they show up in under 60 seconds! Try finding a single team member in Macy’s who isn’t talking about her boyfriends mis-shaped penis on their date last night. The private labels absolutely suck, the lines of clothing have suffered! Every designer has what is known as Sub-lines. Donna Karen has DKNY, Dolche & Gabana has D&G, Calvin Klein has cK Jeans, Vera Wang has that god awful kohl’s line. Field’s HAD the high end lines, not the sub-lines. Macy’s swapped out everything with Sub-lines and acted like it was the same merchandise!!!

    As far as that store bleeding millions. That store was also under a restoration project during it’s last few years under target ownership, so figures aren’t accurate. HOWEVER sales up until 2nd quarter 2006 have been double and tripple what the sales figures are on any quarter. INCLUDING Christmas 4th Quarter!

    I’m a shareholder in the company, voted against the name changes, because the same customers who revolted in Atlanta(Rich’s), Seattle (Bon Marche), Boston (Jordan Marsh), Florida (Burdines–a state filled with NY transplants even hated macys!!!) and Ohio (Lazuras) would be the same customer base who would revolt in Chicago. but the problem with Chicago shoppers is once you moved here, and shopped at Field’s the first time, and realized what an economic impact that store had on the city. You’d support keeping the name the same even if you didn’t shop. Currently they can’t afford to keep the CTA going because of lack of sales tax from lack of shopping at state street. State Revenue figures show sales tax collected to be 94% over previous years. OOOPSSSS Lack of shoppers, lack of tourists to see the store, lack of hotel rooms getting booked, lack of business travelers getting something special for their wife while in Chicago. It’s a downward spiral that will make the morgage melt down look tame when Chicago collapes into a substandard shitty city like Detroit or Denver.

  32. kpfeif says:

    Midwest Retailing Lesson II: Marshall Field and Company

    Yes, Mr. Field founded his store in Chicago in 1852. It grew to be the dominant upscale department store in the Midwest. Yes, they did acquire Dayton’s, but hey, then Macy’s came along…and screwed the pooch.

    The first thing Macy’s did was rename all stores to Macy’s, including the State Street Chicago location – the former flagship of Marshall Field. I don’t recall the actual words, but some Macy’s guy said something like, “people in Chicago will love Macy’s. They’ll forget about Marshall Fields.” Sure. 100+ years of solid brand loyalty…removed. That’ll work. Well, it didn’t. After the first dismal year of sales, Macy’s blamed it on that, “our buyers didn’t by the right merchandise for the Midwest.” Sure. That’s it.

    So, Macy’s is going down the crapper all because they thought those of us in flyoverland would just LOVE that great east coast Macy’s moniker over the 100+ years of Marshall Fields.

  33. kpfeif says:

    Sorry – reversed the order. They were acquired by Dayton’s.

  34. Sidecutter says:

    So over TWO THOUSAND people will lose their jobs. And the company will save around $100 Million?

    I’d wager that exactly one exec with the company could be terminated and save at least $10 million more than that in the process, while 2500+ people could keep their jobs.

  35. ARP says:

    As much as I hate Macy’s (and I do hate them), I think this was the right move for them.

    The problem is that if your fundamentals are wrong, all the cost cutting in the world won’t let you sustain long term profitability as your sales will continue to drop and at a certain point you can’t cut costs any further.

    I think many here got it right with the fundamentals of Macy’s problems: selling sub-tier merchandise for inflated amounts, using too many poor quality private labels, hiring uncaring, low paid staff, and assuming that the Macy’s cache was somehow better than MF’s, Daytons, etc. because it was an east coast brand. While New York thinks the world revolves around them, others do not.

  36. Curiosity says:

    Just to clarify on the actual trend of shopping at the downtown Chicago store. 3-4 years before the name change MF was cutting costs, and the foot traffic was about 10% lighter (upon casual notice).

    However about a year before the name change sales did drop because of a noticeable drop in quality (about the time May was acquired) if not service.

    Now after the name change the quality of the goods and services have significantly dropped to the point most people would rather go to Sears or Kohl’s than Macy’s except for the independent vendors on the 1st floor (like Levengers).

    Realize that MF was reputed to earn their operating costs on the 1st floor alone. Macy’s does not even come close to MF sales even during Christmas as any Chicagoan can tell you.

    Of course these are my observations upon talking to the clerks of both MF and Macy’s at various times.

    I would venture to say this is a case where the consumer is right and perhaps Federated should listen to them?

  37. ancientsociety says:

    @humphrmi: Lol, let me guess, you live in the burbs, right?

    You have to be because only the suburbanites can’t wrap their provincial little minds around the fact that MF was a business and has gone the way of the dodo. “OMG! The traditional Xmas windows are gone! What will we do when we need to experience ‘culture’.”

    Actual Chicagoans (those of us who live within city limits) really don’t piss & moan when another giant, aloof retail corporation changes it’s name.

  38. Merkin says:

    Yeah, this is going to do wonders for Macy’s already miserable public image in Minnesota.

  39. Greasy Thumb Guzik says:

    @DjDynasty:
    Lack of sales tax revenue from shoppers on State St. has nothing to do with why the CTA is broke. The suburban buses & trains are broke too.

    @Curiosity:
    Again, it backwards.
    May Dept. Stores bought Field’s, not the other way around.