Two of America’s largest department store chains, Macy’s and JC Penney, have announced their plans to close stores, which will result in the loss of thousands of jobs.
Macy’s have announced that it would be closing 14 of its 790 stores over the next few months, resulting in the loss of more than 1300 jobs. It does however have plans to open two new stores.
JC Penney is set to close around 40 of its 1060 stores by the 4th
of April, which will result in the loss of almost 2250 jobs.
These decisions come after both chains felt the effect of the growth in online shopping.
According to Macy’s, it is expecting a saving of $140m per annum due to its restructuring plan. The two new stores it intends opening will be based in California. The group announced that its same-store sales experienced a growth of 2.1% year-on-year, during November/December. During its closure program about one year ago, it shut down five stores, resulting in the loss of 2500 jobs.
The latest closure announcement by JC Penney comes almost exactly 12 months after its last restructuring plans when it closed 33 of its stores, resulting in a loss of around 2000 jobs. JC Penney announced earlier this week that its same-store sales for November/December 2014 increased by 3.7%, compared to the same period during the previous year. This resulted in a sharp increase in its share price.
Mike Ullman, the chief executive of JC Penney, is due to step down during August when Marvin Ellison, the former Home Depot boss, will step into his shoes.