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Macy’s and Kohl’s are both leading department stores in the United States, but both have recently announced their plans to close multiple underperforming stores. Macy’s is a retail brand with many store locations across the country. The brand sells clothing, bags, jewelry, furniture, and more. They even host the famous Thanksgiving Day Parade, a popular holiday event. Macy’s often offers discounts and high-quality products in all of their stores nationwide.
In 2024, Macy’s announced their plan to shutter 150 stores by 2026. Macy’s deemed these stores substandard locations for their Bold New Chapter strategy, in which they plan to appeal to wealthier buyers with high-end brands. In early January, Macy’s released a list of 66 locations closing in 2025, including nine in California. Although the number seems large, Macy’s currently operates more than 500 locations in the US and almost 90 in California alone. Macy’s hopes that closing underperforming stores will help improve the more profitable stores with more shoppers and profit. The remaining stores will have more options for buyers and better customer service. Since announcing their plan, the price of Macy’s shares has fallen significantly, and buyers are skeptical about whether or not the changes will be effective.
Another popular department store, Kohl’s, is somewhat similar to Macy’s and offers a variety of products, including clothing, household appliances, books, and makeup. The two stores are most comparable in their clothing distribution, but Macy’s has almost 25% more products, while Kohl’s tends to give higher discounts.
Executives at Kohl’s had a similar idea for maximizing profits, and they announced the planned closure of 27 of their stores only one week after Macy publicized their plan for 2025. All 27 stores were classified as underperforming, and Kohl’s plans to close them to increase the profits of their other 1,123 locations. Out of the 50 states, Hawaii is the only one without a Kohl’s store.
Kohl’s previous CEO, Tom Kingsbury, announced the store closures as one of his last decisions before stepping down earlier this month. Ten stores in California will be closed while other states will have only one or two closures. The stores are scheduled to be completely shut down by April. The decision to close these stores was likely influenced by the difficult few years Kohl’s has experienced as it struggled to adapt to consumer behavior. The future does not seem to hold a sudden increase in profit, either, since Kohl’s has predicted an even larger drop in sales. The department store’s stock has fallen 40 percent over the past six months.
(Britannica, CNN, IntelligenceNode, Kohl’s, Macy’s, Statista)
Categories: National