Macys current performance

Implications: Macys in store servicing of current customers is a key to there growth in this very tough retail climate. There addition of new branded merchandise catagoires , Ie Martha Stewart, Donald Trump , etc. gives them a creative edge to be competative in the next 2 qtrs. The jury is out for most better retailsers . Wal-Mart and Costco appear to be  weathering the economic storm as customers continue  to look for price driven value.

Analysis:  As most  better retailers, Macys is feeling the crunch of reduce servicing of there retail customer base as over the years they have switched from full time staffing to part time on floor staffing to impact the bottom line.

This trend in better upscale department stores continues . With few exceptions , ie Nordstroms, Neiman Marcus where customer servicing is not a thing of the past , better department strores are faced with the dilemina of  full time staffing for better customer servicing verses the cost savings of part time staff.

As more of the  general population reaches the retirement years , (Boomers), who have large  spending dollars at there disposal and demand better servicing at the retail level, the stores  that cater to this population have a better chance of reaping the rewards of stronger growth as the ecomony turns around.

Back to the future apporach of retailers being merchandisers and servicers for the retail customer as opposed to letting the customer service themselves will be a critical point on turnaround to justify the higher margins that this channel requires due to overheads, better merchandising costs, freight/logistics , warehousing  , services offered.

Frank Frystak
President -Frystak Associates
fffrystk@ameritech.net