Macy’s doubles in testing off-mall stores on a smaller scale.
"Over the next two years we will be opening several smaller formats outside of Macy's Mall and testing a smaller format outside of Bloomingdale’s Mall," said Jeff Gennette, chairman and CEO of Macy’s, in the company's tender for the second quarter of 2020.
Earlier this year, Gennette announced that any Macy store outside of the mall would be picked up and returned. However, this week the company announced it would be testing a smaller format for Bloomingdale, which will be launched in the fourth quarter of 2021.
Gennette emphasized that Macy's and Bloomingdales' malls are not giving up, although he believes B and C malls will feel pressure over time.
"We continue to believe that the country's best malls will thrive," Gennette said on the call. "However, we also know that Macy and Bloomingdale have high potential outside of the mall and in smaller formats."
Macy & # 39; s participates in a parade of other retailers testing these concepts for smaller formats. In March, Target reported that small format stores contributed more than $ 1 billion in total sales in 2019. After reaching 100 small-format stores in 2019, the retailer planned to open nearly three dozen new stores.
The small format strategy worked so well for the retailer that it also announced that it was exploring store websites covering approximately 6,000 square feet, roughly half the size of its smallest small format store. These stores would help the retailer reach "even more diners in neighborhoods and on college campuses." The first lease is expected to be signed in 2020 with an opening date in 2021. However, it did so before the US saw the full burden of the COVID-19 shutdowns.
In its June fourth 2020 earnings call, Nike announced it would open 150-200 concepts for small stores in North America, Europe, the Middle East and Africa. Several grocery stores have also tried the strategy. Nordstrom and Ikea have all tested smaller stores that also serve as pick-up locations for orders.
"The modern lifestyle leads to many quick trips to the grocery store and has shoppers looking for practical, healthy, and delicious food solutions," Impact Group said in a 2019 report. "It's a big job for a full-size grocery store , but it seems that these small, focused retail concepts are best able to meet demand. "