Macy's closing 4 Downtown stores across US

[dimondpark]

Originally Posted by NorthernDancer

No, I mean that you post two lists measuring two completely different things, and say "Yup. 2015 is a different story".



Yeah, when lists are measuring completely different things, they tend to be different.

Yawns...no, theyre both by sales per sq ft.

The only difference is the sunken CAD.

Lol Like I said, no need to be salty.

[pdxstreetcar]

Then there's this remarkable remnant remaining of downtown department stores, the Downtown Walla Walla, WA Macy's store...


https://www.yelp.com/biz/macys-walla-walla
http://l.macys.com/walla-walla-wa

Salem Oregon has a Macys, Nordstrom, JC Penney in its downtown, though mostly in an anti-urban mall. Plus a Kohls and Ross FWIW.
https://en.wikipedia.org/wiki/Salem_Center_(Oregon)
https://goo.gl/maps/C6TdF8r5kSN2

[isaidso]

Originally Posted by dimondpark

The Canadian economy has slowed down due to the steep decline in global oil prices and the devalued CAD.

Yet Canadian retail sales are up nationwide. I'd be careful about making assumptions based on perception. Even with the oil price down where it is Alberta's economy might not contract this year. Then there are the other 9 provinces. Which country has the top revenue producing mall is inconsequential but I really don't see Yorkdale slowing down at all. It's a juggernaut, expanding smartly, and still packed like sardines.

You make it sound like Canadian disposable income rests largely on the price of oil. It's not even the biggest industry; autos is.

[dimondpark]

Originally Posted by isaidso

Yet Canadian retail sales are up nationwide. I'd be careful about making assumptions based on perception. Even with the oil price down where it is Alberta's economy might not contract this year. Then there are the other 9 provinces. Which country has the top revenue producing mall is inconsequential but I really don't see Yorkdale slowing down at all. It's a juggernaut, expanding smartly, and still packed like sardines.

You make it sound like Canadian disposable income rests largely on the price of oil. It's not even the biggest industry; autos is.

No, I explicitely stated that the sagging CAD to USD exchange rate was also a factor and this industry tracking company agrees:

For the past two years, we've discussed top North American malls, where about half were Canadian. Because of recent currency fluctuations, we've decided to limit our research to Canadian mall properties. That, and, new numbers show that some top American malls boast significantly higher sales than Canada's top properties.

Forbes recently listed its top 10 ranking for U.S. malls, with Bal Harbour Shops at the top with sales in excess of U.S. $3,000 per square foot. Other top U.S. properties included The Grove in Los Angeles (U.S. $2,100/sq ft), Pioneer Place in Portland, OR (U.S. $1,855/sq ft), Woodbury Common (an outlet mall) near NYC (U.S. $1,550/sq ft), Forum Shops at Caesars Palace Las Vegas (U.S. $1,515/sq ft) and Aventura Mall in Miami (U.S. $1,500/sq ft).

America's top malls now far eclipse their Canadian counterparts as far as sales per sq ft.

Here's our list of top Canadian malls by sales per square foot, annually:

1) Pacific Centre, Vancouver, BC: $1,498

2) Toronto Eaton Centre, Toronto, ON: $1,420

3) Oakridge Shopping Centre, Vancouver, BC: $1,395

4) Yorkdale Shopping Centre, Toronto, ON: $1,356

5) Southgate Shopping Centre, Edmonton, AB: $1,157

6) Chinook Centre, Calgary, AB: $1,125

7) Rideau Centre, Ottawa, ON: $1,008

8) Holt Renfrew Centre, Toronto, ON: "over $1,000" says landlord.

9) Market Mall, Calgary, AB: $942

10) Sherway Gardens, Toronto, ON: $935

11) Square One, Mississauga, ON: $910

12) Metropolis at Metrotown, Burnaby, BC: $886

13) Polo Park, Winnipeg, MB: $873

14) Peter Pond Mall, Ft. McMurray, AB: $870

15) Le Carrefour Laval, Laval, QC: $865

16) Fairview Mall, Toronto, ON: $843

17) Richmond Centre, Richmond, BC: $833

18) Royal Bank Plaza, Toronto ON: $820

19) Toronto Dominion Centre, Toronto, ON: $818

20) Bayview Village, Toronto, ON: $810

http://www.retail-insider.com/retail-insider/2015/5/most-productive

3 Canadian malls would rank in the USs top 10, no Canadian mall would rank in the USs top 5.
http://www.cnbc.com/2015/06/08/-per-square-foot.html

[Jonesy55]

Double

[Jonesy55]

Originally Posted by 10023

I'm not sure the situation in the UK is all that different from the US, to be honest. The "downtown" (i.e., city center) are generally in the places you'd expect them to be, and then there are a bunch of freestanding suburban ones.

Taking John Lewis (kind of a Macy's equivalent) as an example, you've got the big Oxford Street flagship and Peter Jones in Sloane Square (which kept the name of an acquired store but is the same thing) in central London, and some others that you might consider urban around greater London, and downtown stores in places like Manchester and Edinburgh.

Then you've got stuff like the Cribb's Causeway location in Bristol: http://www.johnlewis.com/our-shops/cribbs-causeway

I don't know if the trend is towards center city locations closing in favor of malls, but the lack of a location in central Bristol (a city of 450k and a metro area of 1 million, with a fairly strong economy) would lead indicate that this is probably the case.

I don't think they are closing many city centre locations, John Lewis doesn't have a store everywhere, they just opened one in Birmingham City Centre a few months ago.



Likewise the Cardiff city centre branch is only a couple of years old.

[miketoronto]

Originally Posted by Jonesy55

Likewise the Cardiff city centre branch is only a couple of years old.

Now that is classy. American stores just don't have the vision or style anymore, and that is why they are hurting.

Too many branches, no vision, cost cutting. All combine for not making a good business model.

And it is not just American department stores. Tons of American chain stores have had major problems, because they simply have just too many stores, and are not visionary anymore.

[Jonesy55]

Yes, the front of the store facing the pedestrianised street is nice. The rear end isn't quite as good though

[mhays]

Originally Posted by miketoronto

Now that is classy. American stores just don't have the vision or style anymore, and that is why they are hurting.

Too many branches, no vision, cost cutting. All combine for not making a good business model.

And it is not just American department stores. Tons of American chain stores have had major problems, because they simply have just too many stores, and are not visionary anymore.

Maybe they need to hire retail expert miketoronto to solve their problems.

Or maybe retail is difficult even for professionals.

[miketoronto]

Originally Posted by mhays

Maybe they need to hire retail expert miketoronto to solve their problems.

Or maybe retail is difficult even for professionals.

They just have lost their way, like a lot of things in America. It does not take a retail professional to know you don't need 5 of one store within 10 minute drives of each other. Or that not putting any effort into building attractive, unique, and stylish stores leads to less customers.

The first thing I would do is probably close to half of the stores, and make the remaining stores real interesting places to shop.


Even look at chains like Tiffany's. They have been opening so many stores that they are losing their cache as a top notch destination. You see this in China, where they are shunning many of the top brands, because they have now become too common.

So yeah, the professionals in American retail are not doing a good job. And you see it when you visit retail stores in other countries, and see just how much better they are than a lot of the places we have here in North America.

[mhays]

Aaaaand that's why you're not in charge of these things. It's not just a millennial thing, but you fit the stereotype. You think your general impressions are right, despite having little clue about how things work.

I'm not an expert either. But I try to understand these things because my company builds retail (and housing, offices, labs and so on) and it's my job. The more I've learned the less I think I know.

For example "attractive, unique, and stylish stores" can attract customers, but they cost a lot of money to design, build, and operate. And "stylish" gets outdated quickly.

Having five locations in a small area might mean a lot more market share (and sales) than having three stores in that area with competitors picking up the slack. Maybe the marketing and supply chain people want to concentrate in certain markets vs. spreading more thinly across the landscape. And maybe they're spacing stores because a lot of people will only travel so far before choosing a competitor instead.

High-end stores can do well with economy of scale too. Even if it dilutes the luxury cachet of the brand maybe they make more money with more stores.

The actual experts do get things wrong. But they know 1,000 times as much as you do, and 200 times as much as I do.

[fflint]

Originally Posted by miketoronto

They just have lost their way, like a lot of things in America. It does not take a retail professional to know you don't need 5 of one store within 10 minute drives of each other.

You do realize most Americans know they have the option to purchase by phone and enjoy door-to-door delivery, right? That if you closed half the stores in America, you wouldn't force everyone into the other half--that you would simply lose market share to online retail, right? I shop more online than ever, despite living in one of the only cities on the continent with a world-class shopping district. You know why? Because it is convenient. The general public does not get a boner for downtown department stores like you do.

[miketoronto]

Originally Posted by fflint

You do realize most Americans know they have the option to purchase by phone and enjoy door-to-door delivery, right? That if you closed half the stores in America, you wouldn't force everyone into the other half--that you would simply lose market share to online retail, right? I shop more online than ever, despite living in one of the only cities on the continent with a world-class shopping district. You know why? Because it is convenient. The general public does not get a boner for downtown department stores like you do.

And with more online sales, stores are going to have to put the focus on just a few good locations. This has already been talked about.

Whether you like it or not, America is over retailed, and the stores are already closing, and more will probably have to close. You just have too much retail, and it is not sustainable.

And this goes beyond downtowns fflint. There are hundreds of dead malls, which also once had Macy's. These malls are victims of the over retailing of America, just as much as the downtowns were.

[fflint]

Oh, I don't disagree--there are too many malls, too many brick-and-mortar stores. I'm actually surprised San Francisco's downtown shopping mecca continues to grow, given how much commerce is now conducted online.

[mhays]

Originally Posted by miketoronto

And with more online sales, stores are going to have to put the focus on just a few good locations. This has already been talked about.

Whether you like it or not, America is over retailed, and the stores are already closing, and more will probably have to close. You just have too much retail, and it is not sustainable.

And this goes beyond downtowns fflint. There are hundreds of dead malls, which also once had Macy's. These malls are victims of the over retailing of America, just as much as the downtowns were.

Yes, in some places, particularly cities that allow easy leapfrog growth and therefore have dead malls. And also in cities that think every street should have retail and therefore require more of it than the added residents/workers justify.

But that's very different from whether retailers themselves are doing smart things.

In fact, the existence of vacant space is basically opposite from the notion that stores themselves should have fewer locations. Some people argue that we should use cheap retail space to encourage more stores.

[Quixote]

The Macy's at Paseo Colorado was actually pretty dumpy (the one on Lake Avenue is much nicer ... and only five minutes away) and housed in an ugly fortress-like structure that added absolutely nothing to the streetscape. I'm glad it's now gone and will be replaced with this:

[miketoronto]

Originally Posted by mhays

In fact, the existence of vacant space is basically opposite from the notion that stores themselves should have fewer locations. Some people argue that we should use cheap retail space to encourage more stores.

Many online only stores are now opening storefronts. People still like going in person for many things, and not everyone wants to be behind a screen all the time.

So yes you will see more stores opening. But you also don't need five of one type of clothing store within a few minutes drive of each other.
We have too much retail in terms of the same store opening so many branches, that they are not just eating business away from their existing stores.

This is even documented from when the department stores opened their first branch stores in the suburbs. All they did was divert shoppers from their existing stores.

[Gordo]

It's very hard to prove a counterfactual. If Sears had decided to not open stores in malls and instead focused only on their large downtown department stores instead, they might have gone out of business in the 70s. Doesn't it say something that nearly all of the small regional department store chains were bought out by Macy's or some company later bought out by Macy's?

You're claiming that an entire industry doomed itself - which may or may not be true - but how would a single actor in that industry have prevented it? Even now, if Macy's started closing all of their suburban locations and building/expanding huge downtown locations, won't someone else come along and at least open some suburban locations? Why wouldn't they?

[mhays]

Thanks for the additional logical fallacies.

"Not everyone wants to be behind a screen all the time" can easily coincide with a dramatic reduction in stores. You might have noticed that most retail currently happens at stores. For example Amazon isn't even 1/4 Walmart's sales volume if I recall, despite being the dominant online retailer in NA. If the future is 50/50 that means a lot less sales at stores.

Whether a chain "needs" five stores in a given area would be best figured out by them, vs. someone who doesn't know retail, wouldn't it?

As for the department store, I really doubt it as an "all it did" scenario. Maybe sales didn't grow as much as they expected, and maybe it cannibalized some sales at the downtown store, but it might have still been good business.

It's great that we're talking about this stuff. And what's good for the stores is often not good for the cities. But your idea that you know more about these businesses than the people that run them is just entitled kid run amok. You got participation trophies and mom said all your ideas were golden so...

[miketoronto]

Originally Posted by Gordo

It's very hard to prove a counterfactual. If Sears had decided to not open stores in malls and instead focused only on their large downtown department stores instead, they might have gone out of business in the 70s. Doesn't it say something that nearly all of the small regional department store chains were bought out by Macy's or some company later bought out by Macy's?

You're claiming that an entire industry doomed itself - which may or may not be true - but how would a single actor in that industry have prevented it? Even now, if Macy's started closing all of their suburban locations and building/expanding huge downtown locations, won't someone else come along and at least open some suburban locations? Why wouldn't they?

This transcendes more than just the downtown stores. Stores have done this throughout suburbia and are seeing the same issues. There are too many branches of each store, even in suburbia, and this is leading to so much of these closed stores. You simply don't need 10 GAPS within 5 or 10 minute drives of each other. Same goes for Macy's, and for every other store.

Macy's closing all their suburban stores would not make any sense. But Macy's closing down many of their suburban locations, and putting the focus on a few good stores in the suburbs would probably do wonders.

We are over retailed, and this is why you are seeing so many companies closing so many of their stores. They simply over expanded and need to concentrate on a few good quality locations.

Sometimes you also need planning policy to regulate things, and this is where America needs some good strong planning regulations. The constant out migration of retail is not helping anyone, including these stores.

American store are also just not innovative anymore. You really see this when you go to Europe and see how much better their retail stores are.
Even if you look at Macy's in Manhattan. Until recently, their food hall was basically a McDonalds and Starbucks. Compared to the outstanding food options you get in European department stores.

American has just lost its vision and our stores need to get back to thinking big again.