Macy's Loses The Hyphens
September 20, 2004-- Home Textiles Today,
Federated's move to strip the non-Macy's nameplates from its hyphenate regional chains will create a $13.5 billion, 423-unit Macy's operation. The change also will mark Federated's full nationalization of its two retail brands, Macy's and Bloomingdale's.
Federated's decision to further leverage the Macy's brand affects regional department stores that currently operate as Burdines-Macy's in Florida, Bon-Macy's in the Pacific Northwest, Goldsmith's-Macy's in Tennessee, Lazarus-Macy's in the Midwest, and Rich's-Macy's in the Southeast. These stores will begin operating exclusively under the name Macy's by the end of January.
Barely a year after converting its regional chains to hyphenated nameplates sharing the Macy's link, Federated will create new Macy's divisions: Macy's/Central (Rich's, Lazarus, Goldsmith's); Macy's/Northwest (Bon); and Macy's/Florida (Burdines). They will join the existing Macy's/East and Macy's/West divisions.
“The evolution of the Macy's brand is a significant development for our company and its competitive positioning in the retail sector,” said Terry Lundgren, Federated chairman, president and CEO.
Operating under a single Macy's nameplate also gives the company increased ability to develop exclusive merchandising arrangements with vendors, Lundgren said, as well as expand its private brands. He added that the company also expects this decision to lead to expense efficiencies over time by leveraging such areas as collateral materials in marketing, visual merchandising and credit.
The management, organizational structure and operations of the three divisions operating stores under the hyphenated nameplates will be unaffected by the change.
The 184 stores converting to Macy's will join the 239 department stores that already operate under that name in 19 eastern and western states, Guam and Puerto Rico.
“This divisional structure enables us to operate under one nameplate while continuing to reflect the unique regional differences in buying and merchandising that exist among our markets,” Lundgren said.
Federated expects expenditures for these changes to be absorbed in its annual $600 million capital expenditures budget. It also expects that incremental transition expense will be immaterial.
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