US department store chains JC Penney and Macy’s have announced plans to close stores and cut thousands of jobs.
JC Penney said it would close 39 of its 1,060 stores by April 4, cutting some 2,250 jobs while fellow US department store Macy’s said it would close 14 of its 790 stores in the next few months, with the loss of more than 1,300 jobs.
Both US department store chains are adapting their store portfolios to react to the continued growth of online shopping.
“Our business is rapidly evolving in response to changes in the way customers are shopping across stores, desktops, tablets and smartphones,” said Terry Lundgrun, Macy’s chairman and chief executive. “We must continue to invest in our business to focus on where the customer is headed – to prepare for what’s next.”
Macy’s, which also operates Bloomingdale’s stores, has also unveiled a series of changes to its operations. Previously products for Macy’s and Bloomingdale’s online and bricks-and-mortar stores were purchased and marketed separately but these will now be united.
Macy’s revealed its like-for-like store sales grew by 2.7% in the months of November and December, compared to the same period last year.
On Tuesday, JC Penney reported like-for-like store sales growth of 3.7% for the nine-week period in November and December. The company said it now expects to report fourth quarter comparable store sales at the upper end of its previous guidance range of 2 to 4%.
Last year, JC Penney announced a previous restructuring which included the closure of 33 stores and the loss of around 2,000 jobs. Macy’s, meanwhile, closed five stores in 2014 and cut 2,500 jobs.
In a separate development, US young fashion retailer The Wet Seal, has also announced it is closing 338 retail stores, resulting in the loss of approximately 3,695 full- and part-time jobs.
The company estimates that the stores represent approximately 48% of its net sales for the nine months ended November 1, 2014. Following the store closures, The Wet Seal will operate 173 stores in the US and its online business.
Fellow US department store chain Sears closed around 200 of its Sears and Kmart loss-making stores in 2014, leaving the retailer with a portfolio of approximately 1,700 Sears and Kmart stores and 200m sq ft of space in 2015.