(Reuters) - Macy’s Inc (M.N) said it would shut 35-40 underperforming stores, accounting for about 1 percent of the department store operator’s sales, as more and more customers shop online.
The annual sales volume of the stores, net of sales expected to be retained in nearby stores and online, is expected to be about $300 million, the company said in a statement.
The company, which operates 770 Macy’s stores, said the store closures would be early next year and that it would announce the locations of the affected stores on a later date.
Globally, Macy’s operates a total of 885 stores, including Macy’s, Bloomingdale’s and others.
The company said that over the past five years, it had closed 52 Macy’s stores and opened 12 new ones as part of its efforts to optimize its omnichannel approach to customers.
U.S. retailers are focusing on ecommerce offerings as customers increasingly prefer the convenience and ease of online shopping over brick-and-mortar stores.
In August, Macy’s Chinese joint venture tied up with Alibaba Group Holding Ltd (BABA.N) to set up a store on Tmall, Alibaba’s online marketplace.
Macy’s has also been pressured by activist investors, including Starboard Value LP, to spin off its highly-prized real estate assets.
The company’s shares were unchanged at $59.17 in trading after the bell.
Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Savio D'Souza