Macy’s has lost the ‘majority’ of its sales.
Macy’s, which also owns Bloomingdale’s and Bluemercury, said on Monday, March 30, 2020, that it had lost “the majority” of its sales because of store closures, which started March 18 and would persist until the retailer had a “clear line of sight on when it is safe to reopen.”
The company said that as a result, it will furlough the majority of its employees this week and maintain the “absolute minimum work force needed to maintain basic operations,” according to a statement. There will be fewer furloughs among employees supporting the digital business at call centres and distribution centres. Macy’s had 130000 part-time and full-time employees as of Feb. 2, 2020.
The move shows the strain that the pandemic is placing on retailers selling goods that are considered nonessential. Many department stores and mall chains had already been weakened in recent years by the rise of e-commerce and a drop in foot traffic at malls. A complete closure of stores and a shift in consumer spending is dealing a new blow to such companies and their many employees.
Macy’s also said that it had already stopped capital spending and paying a dividend. It has also drawn down its line of credit and cancelled some orders.
“While these actions have helped, it is not enough,” the company said. “At least through May, furloughed colleagues who are enrolled in health benefits will continue to receive coverage with the company covering 100 % of the premium. We expect to bring colleagues back on a staggered basis as business resumes.”