The financial wizards have been talking about this for many years.
Retail has gone from shopping malls to the internet.
Big changes are coming at the end of summer.
Starting with Macy’s to close 68 stores by August 2017. They have 100 stores on the chopping block.
Wednesday’s announcement came at no surprise after their Christmas sales had not reached the potential that Macy’s outgoing Chairman and CEO Terry Lundgren had expected.
First to go will be the top management positions to cut cost. It also will work to reduce other non-payroll costs. Macy’s estimates its work force will be cut by 6,200.
Another 3,900 workers will be displaced by the store closures and some of these employees may be reassigned but very doubtful.
The store closures are an attempt to reverse the loss in sales at stores. Macy’s is turning its focus on its best-performing locations and its website. Macy’s move will save the company an estimated $550 million a year starting in 2017. The company will use these proceeds to invest an additional $250 million in its digital business and other sub companies.
The internet is big competition for store locations. There is less over head in the millions when operating an internet store. Most orders are placed through a computer, tablet or smartphone. Which eliminates employee payroll, utilities and commercial leases. Out sourced customer service has little payroll, no employee benefits or insurance expenses.
This is just the start to a trend of stores cutting over-head and moving to the digital market.
If you have ever thought about jumping into the digital market. This is the time. The potential for earnings are limitless. Thousand of jobs are available today. Just think of next year when there will be a 56% more stores available online. All most all of your top tier stores are available today at the touch of your fingers.
Pretty soon the digital market will become norm and everyone will be shopping from the comfort of their homes.
Many stores and companies are turning to the internet, to turn up their profits.