||This article needs additional citations for verification. (November 2012)|
|Traded as||NYSE: M
S&P 500 Component
|Founded||Columbus, Ohio (1929 as Federated Department Stores, Inc.)|
|Headquarters||Cincinnati, Ohio, U.S.|
|Number of locations||850 (January 2011)|
|Key people||Terry J. Lundgren
(Chairman, President and CEO)
Karen M. Hoguet
(Chief Financial Officer)
(Chairman, President and CEO of Bloomingdale's}
(Chief Marketing Officer)
(Chief Stores Officer)
(Group Vice President, National Events)
(Senior Vice President, Macy's Parade)
|Products||Clothing, footwear, accessories, bedding, furniture, jewelry, beauty products, and housewares|
|Revenue||US$ 26.405 billion (FY 2011)|
|Operating income||US$ 2.411 billion (FY 2011)|
|Net income||US$ 1.256 billion (FY 2011)|
|Total assets||US$ 22.095 billion (FY 2011)|
|Total equity||US$ 5.933 billion (FY 2011)|
|Employees||171,000 (January 2012)|
Bloomingdale's, Rich's, Lazarus, Macy's Funiture Store, Kaufman's, Goldsmith's, The May Department Stores Company, Federated Department Stores
Macy's, Inc., originally Federated Department Stores, Inc., is an American multinational holding company headquartered in Cincinnati, Ohio. It is the owner of department stores Macy's and Bloomingdale's, which specialize in the sales of clothing, footwear, accessories, bedding, furniture, jewelry, beauty products, and housewares. The company operates approximately 850 stores in the United States; its namesake locations and related operations account for 90 percent of its revenue. The company is well known for its prominent flagship stores located throughout the country, most notably those of Macy's in New York, San Francisco, and Los Angeles; former facilities include Jordan Marsh in Boston, Dayton's in Minneapolis, Kaufmann's in Pittsburgh, Burdine's in Miami, Rich's in Atlanta, Wanamaker's in Philadelphia, Marshall Field's location in Chicago, and Famous-Barr in St. Louis. According to Deloitte, Macy's, Inc. is the world's largest fashion goods retailer and the 36th largest retailer overall, based on the company's reported 2010 retail sales revenue of $25 billion.
Federated Department Stores was founded in Columbus, Ohio in 1929 as a department store holding company for Abraham & Straus, F&R Lazarus & Company (including its Cincinnati division, then known as Shillito's) and William Filene's Sons of Boston; Bloomingdale Brothers joined the organization the following year. Federated was the successor to the Lazarus operation begun in Columbus in 1851. In the mid-1930s, a modern merchandising standard was set when Fred Lazarus Jr. arranged garments in groups of a single size with a range of style, color and price in that size, basing the technique upon observations made in Paris. Fred Lazarus Jr. also convinced President Franklin D. Roosevelt that changing the Thanksgiving holiday from the last Thursday of November to the fourth Thursday, extending the Christmas shopping season, would benefit the nation's business; an act of Congress perpetuated the arrangement in 1941. After this date Black Friday became a nationwide sensation and the most profitable day for Federated. Other companies tried to follow suit but failed to achieve what John Albert Macy had in mind. Various Lazarus family members also held key positions on Federated's board and within its various divisions—namely, Foley's, Filene's, Lazarus and Shillito's. As of January 2002, Robert Lazarus Jr. was the only family member still with an official role at Federated, serving as assistant to Ron Klein, then chairman and CEO of the Rich's/Lazarus/Goldsmith's operating unit. Federated's corporate offices were relocated to Cincinnati in 1945.
The later half of the 20th century saw the company expand nationwide, adding Rike Kumler of Dayton, Ohio (merged into Shillito's in the 1980s to become Shillito-Rike's); Burdines of Miami, Florida; Rich's of Atlanta, Georgia; Foley's of Houston, Texas; Sanger Brothers and A. Harris, both of Dallas, Texas (which was merged with Sanger Brothers to form Sanger-Harris); Boston Store of Milwaukee, Wisconsin; MainStreet of Chicago, Illinois; Bullock's, of Los Angeles; I. Magnin, of San Francisco, California; Gold Circle; and Richway Discount Department Stores of Worthington, Ohio. In 1982, Federated acquired the Twin Fair, Inc. discount store chain based in Buffalo, New York and merged it with Gold Circle. In 1983, it sold most of its infrastructure to JMB Realty.
To support its huge retail operations, Federated centralized its back-office functions into several large divisions, covering financial services, marketing, merchandising, logistics, and data processing systems. Other retailers' branded credit cards are usually issued and serviced by a third-party bank; Federated was so huge that it ran its own private bank, FDS Bank, which for many years issued and maintained the majority of its own consumer credit card portfolio with a portion at one time owned by General Electric Credit Corporation, an arrangement inherited from when R.H. Macy & Company sold their credit portfolio in an attempt to prevent filing for bankruptcy. In 2005 Federated finalized an arrangement with CitiGroup to sell its consumer credit portfolio, reissuing its cards under the Federated-CitiGroup Alliance name Department Stores National Bank (DSNB) and allowing Federated to continue servicing the credit accounts from its Financial, Administrative and Credit Services Group (Macy's Credit and Customer Services)
In 1990, Federated—now under the control of Robert Campeau—went bankrupt after its hostile takeover of Allied Stores; it emerged from bankruptcy after the ouster of Campeau in 1992 as a new public company. Federated then took over Macy's in 1994 while that company was still emerging from its own bankruptcy in 1992. Federated entered e-commerce late, in 1998. FDS Bank was one of the last credit card banks to begin to allow its cardholders to access account information online (around 2004). The department store chain Stern's, a division of Federated, ceased operations in 2001 and most of its stores became Macy's stores. In 2003, Federated changed the nameplates of all their non-Macy's stores, except Bloomingdale's, to include the Macy's name. The rebranding process was referred internally to as Project Hyphen. Under the plan, Seattle-based The Bon Marche became Bon-Macy's; Goldsmith's in Tennessee became Goldsmith's-Macy's; Lazarus, Burdines, and Rich's also added "-Macy's" to their name. A year later, the original hyphenated names were dropped in favor of just Macy's, a rebranding process referred internally to as Project Star.
Federated settled an SEC investigation for $14.46 million in 1998 due to unethical debt-collection practices. Federated routinely forced credit card holders/debtors to sign an agreement that legally bound them to repay their outstanding balances instead of having the unsecured debt discharge via the filing of bankruptcy. Federated failed to file reaffirmation agreements with bankruptcy courts. As a result, the changes in the agreements were not legally binding.
May Department Stores acquisition
On July 18, 2005, Federated Department Stores announced that they would acquire May Department Stores company for $11 billion in cash and stock. Also part of the buyout was the bridal and formal unit of May, consisting of David's Bridal and After Hours Formalwear. Federated would also assume $6 billion of May's debt, bringing total consideration to $17 billion. The deal would create the nation's largest department store chain with over 1,000 stores and $30 billion in annual sales. To help finance the deal, Federated agreed to sell its combined proprietary credit card business (but still administered by FACS Group, a subsidiary of Federated) to Citigroup. The merger was completed on August 30, 2005, after an assurance agreement was reached with the State Attorneys General of New York, California, Massachusetts, Maryland and Pennsylvania.
Federated announced plans to sell 80 store locations in 2006, having pledged in its settlement to sell most of them as viable businesses, with preference being given to a group of thirteen competitors. This number could fluctuate pursuant to Federated's negotiations with various mall landlords and its final decision regarding using former Macy locations for its luxury Bloomingdale's operation.
On January 12, 2006, Federated announced its plans to divest May Company's Lord & Taylor division (55 stores in 12 states) by the end of 2006 after concluding that chain did not fit with their strategic focus for building the Macy's and Bloomingdale's national brands. On June 22, 2006, Macy's announced that NRDC Equity Partners, LLC would purchase Lord & Taylor for US$1.2 billion, and completed the sale in October 2006.
On September 9, 2006, May Company division stores Famous-Barr, Filene's, Foley's (the prior two were former Federated stores in their own right), Hecht's, The Jones Store, L. S. Ayres, Marshall Field's, Meier & Frank, Robinsons-May, and Strawbridge's brands ceased to exist as Federated replaced most of them with the Macy's masthead, and a select few converting to the Bloomingdale's brand. The conversion of Marshall Field's in Chicago has been particularly criticized, with many customers boycotting the State Street store and staying away from the emporium. The Chicago Tribune continues to report on the poor reception of Macy's in Chicago. Kaufmann's in Pittsburgh also had a dislike to the change most due to the concern of the local parade run by the store. Other stores like Famous-Barr in St. Louis also disliked the change, but not nearly as much as Marshall Field's.
One of the consequences of this rebranding is that over 80 U.S. malls now have two Macy's department stores. In Downtown Boston, Federated liquidated an acquired Filene's because it already had a Macy's (formerly a Jordan Marsh) across the street. The two stores have a combined floorspace of more than 1,400,000 square feet (130,000 m2), more than two-thirds the size of Macy's New York City flagship store.
Operations as Macy's, Inc.
On February 27, 2007, Federated announced that its board of directors would ask shareholders to change the company's name to Macy's Group, Inc. By March 28, the company revised its plans for the new name, opting to eventually become Macy's, Inc. Federated shareholders approved the revised proposal during the company's annual meeting on May 18, 2007..The company was previously known as Federated Retail Holdings, Inc.
The name took effect on June 1, 2007. Reasoning for the proposed name change, according to Terry Lundgren, Federated's chairman, president and chief executive officer — hinges on the large-scale conversions throughout the company toward the Macy's nameplate. "Today, we are a brand-driven company focused on Macy's and Bloomingdale's, not a federation of department stores," Lundgren said in the company's press release heralding the proposed name. Upon the change to Macy's Inc., Federated's stock ticker symbol on the New York Stock Exchange changed from "FD" to "M", making the new Macy's Inc. one of a handful of single-letter ticker symbol companies.
In April, 2008, Moody's Investors Service said that it may downgrade Macy's Inc. bonds to just above junk status. That same month, Fitch Ratings downgraded their ratings to BBB- from BBB, noting a deterioration in the company's operating and credit metrics. A rating of BBB- is one notch above junk status.
On Wednesday, February 6, 2008, Terry Lundgren announced the localization strategy and the company's plan to shed 2,550 jobs. This new localization strategy is known as "My Macy's."
Employees of the Macy's North headquarters office in Minneapolis, the Macy's Northwest headquarters office in Seattle, and the Macy's Midwest headquarters office in St. Louis were given pink slips, as Macy's pared its seven regional centers to four. About 40 new jobs were to be created in May as part of the restructuring. By 2009, the company expected to save $100 million a year from the cuts.
On February 2, 2009 Macy's said it will cut 7,000 jobs, or 4 percent of its work force, and slash its dividend as it looked to lower expenses. Cincinnati-based Macy's Inc. said the work force reduction includes positions in offices, stores and other locations. The cuts will include some unfilled jobs. "Reducing our workforce is an unfortunate outcome of the current economic environment, and I am frustrated that so many of our people will be unable to move forward with us as we proceed into a very exciting future for Macy’s and Bloomingdale's" said Terry J. Lundgren, chairman, president and chief executive officer. "
Macy's will also begin getting rid of its division structure and integrating its functions into one organization. Macy's central buying, merchandise planning, stores senior management and marketing functions will be located primarily in New York. Corporate-related business functions, such as finance and human resources, will be primarily in Cincinnati. To buy with local consumers in mind, Macy's developed a concept called "My Macy's", in which the buyers and planners all look at what the local consumer base is looking for in their local Macy's store. This will help bring a better sense of branding, sizing and marketing to each Macy's store nationwide.
Macy's Inc.; decided that it would be closing the doors to Bloomingdale's at Mall of America, in Minnesota. Since 1994, Bloomingdale's has been the anchor store of the mall, and will be replaced with a $30 million renovation with four new foreign clothing stores.
Division of Macy's Inc.
R.H Macy & Co. (Macy's)
- Macy's Division Leader: Terry J. Lundgren, President and CEO of Macy's.
- Macy's Founder: Rowland H. Macy
Bloomingdale Brothers (Bloomingdale's)
- Bloomingdale's Division Leader: Michael Gould, President and CEO of Bloomingdales
- Bloomingdale's Founder: The Bloomingdale Family
- Macy's Marketing Division Leader: Martine Reardon, Chief Marketing Officer
- Macy's Marketing (sometimes called Advertex Communications) formally known as Federated Direct (1999-2003)' Federated Corporate Marketing (2003-2007) and Macy's Corporate Marketing (2007-2009) is in charge of all marketing for Macy's including advertisements, social media and National Events. Macy's Marketing was formally lead by Peter Sachse (2003-2006, 2007-2012) and Anne MacDonald (2006-2007). In February of 2012, Macy's Inc. announced some executive changes that placed Sachse as Chief Stores Officer and elevated Martine Readon (then Executive Vice President, National Marketing) to Chief Marketing Officer. Under the Macy's Marketing brand is Macy's Social which is in charge of all social networking Macy's is on. Macy's Press which is in charge of all Macy's Press Releases and to an extant the Macy's Parade and Entertainment Group.
- Macy's Online Division Leader: Jeffrey Kantor, President, CEO of Macy's Online (macys.com)
Macy's Parade and Entertainment Group
- Macy's Parade and Entertainment Group Co-Leader: Robin Hall, Senior Vice President, Macy's Parade
- Macy's Parade and Entertainment Group Co-Leader: Amy Kule, Group Vice President, National Events
Macy's Merchandising Group
- Macy's Merchandising Group Division Leader: Jeffrey Gennette, Chief Merchandising Officer
- Other Key People: Julie Greiner, Chief Merchandise Planning Officer
- Macy's Stores Division Leader: Peter Sachse, Chief Stores Officer
- Macy's Finance Division Leader: Karen Hoguet, Chief Financial Officer
Macy's Private Brands
- Macy's Private Brands Division Leader: Timothy Adams, Chief Private Brand Officer
- "2011 Form 10-K, Macy's, Inc.". United States Securities and Exchange Commission.
- "Store Count and Square Footage", Macy's Inc. Visited on December 25, 2008.
- Deloitte, Switching Channels: Global Powers of Retailing 2012, January 2012, at pp. G11 and G27.
- "Federated to Buy Twin Fair Stores," The New York Times, Mar 27, 1982 (accessed Aug 26, 2008).
- "Federated Settles for Millions," BCD News and Comment. Vol. 32:1. 3 March 1998.
- "Federated Department Store Settles FTC Action for 8 Million," Consumer Financial Services Law Report. Vol. 3:1. 11 June 1999.
- "FTC and Federated Settle Reaffirmation Claims," Consumer Bankruptcy News, Vol. 8:19. 17 June 1999.
- Federated Agrees to Sell Bridal Group, Federated Department Stores, Inc., November 17, 2006.
- Federated Plans Corporate Name Change, Federated Department Stores, February 27, 2007.
- Federated Plans 'M' Stock Ticker, AP, March 28, 2007.
- The Romance of a Great Store by Edward Hungerford Early History of Macy's 1922
- Many Happy Returns to Lazarus WOSU-TV Documentary
- Charles Lazarus Interview Columbus Jewish Historical Society
- Former Lazarus Chairman and Federated Director Charles Lazarus Dies at Age 93, Columbus Dispatch, May 14, 2007
- Charles Lazarus Recalled as Retail and Civic Leader, Columbus Dispatch, May 15, 2007
- Best of times: Staffers remember when work seemed like a family, Columbus Business First, December 21, 2001
- Biography of Ralph Lazarus (1914 - 1988) University of Cincinnati
- Great Living Cincinnatians: Fred Lazarus, Jr. Greater Cincinnati Chamber of Commerce
- Prospecting Pays Time Magazine, December 9, 1946
- Shuffling the Lazari Time Magazine, September 29, 1967
- Time to Get Involved Time Magazine, January 19, 1968
- Personalities Time Magazine, April 3, 1964
- Family Affair Time Magazine, September 8, 1958
- Foley's New Look Time Magazine, November 3, 1947
- How Much is Enough? Time Magazine, July 16, 1945
- Name change has hurt Macy’s, The Columbus Dispatch, June 6, 2006