Macy’s Inc. unveiled a series of cost cuts Wednesday, intended to cut selling, general & administrative costs by about $400 million. “In light of our disappointing 2015 sales and earnings performance, we are making adjustments to become more efficient and productive in our operations,” Chief Executive Terry Lundgren said in a statement. The cost cuts are equal to more than two-thirds of the department store chain’s goal of annual SG&A cost cuts of $500 million, net of growth initiatives. They include the closure of 40 stores, 4 of which were shuttered in 2015, the remaining 36 of which will be closed in spring. The company is consolidating the grouping of its stores into five regions and 47 districts, from a previous 7 regions and 58 districts. It will cut jobs at its Macy’s and Bloomingdale stores, affecting 3,000 employees, some of whom will be placed in other positions. It will offer voluntary buyouts to about 165 senior executives in its stores, office and support functions. About 35% of those roles will be eliminated. The company has hired investment bank Eastdil Secured to advise on its plans for real-estate transactions with help from Credit Suisse and Goldman Sachs, and is searching for a senior real-estate executive to manage ventures. The company expects to book a charge of $200 million in the fourth quarter, which was not included in its previous guidance.
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