Macy's to open 'small format' store in North Jersey this weekend. Here's what that means

Macy’s is opening what it calls a “small-format” store at a former Bed Bath & Beyond at the Interstate Shopping Center in Ramsey this Saturday.

Welco Realty Inc., which represented the landlord in the deal, first announced last fall that the iconic clothing retailer will occupy 25,000 square feet at the former home goods store in Ramsey. Macy’s is joining ShopRite, DSW, Burlington, Michael’s and Old Navy.

The Macy's small-format store will feature products such as clothing for men, women and children; beauty products; toys; luggage and gifts, including brands Levi’s, MAC and Calvin Klein, as well as Macy’s own brands such as INC and Bar III.

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Macy’s is opening up to 30 of these small-format locations beginning in 2024 and through fall 2025, an October announcement said. It has 24 locations in New Jersey, mainly in malls.

The stores will be “paired with a premier digital experience,” Macy’s said. The stores are roughly one-fifth the size of those in malls, Macy’s noted.

“Our small-format stores are efficient to operate, provide the customer with a shopping alternative within our omnichannel ecosystem and present a unique opportunity to target high-traffic shopping centers," Adrian Mitchell, chief operating officer and chief financial officer at Macy’s, has said.

“Our small-format strategy is one way we intend to harness the full power of the Macy’s brand to deliver sustainable, profitable sales growth,” Mitchell said.

Analyst Neil Saunders, managing director for retail at Global Data, said that the "small-format strategy is sensible in that it allows Macy’s to expand in areas where demand is strong."

“The smaller nature of the stores also means there is less capital spending, and it aligns with the simpler, quicker shopping experiences that many of today’s consumers want," he said.

How's Macy's doing?

Macy’s beat Wall Street’s expectations in the first three months of 2024 but still fared worse than last year, according to a first quarter earnings report.

The nation’s largest clothing retailer posted net sales of $4.85 billion, down 2.7% from the first quarter in 2023 but still higher than the $4.81 billion Wall Street expected, according to Yahoo Finance.

In March, Macy's announced it was closing 150 unproductive stores across the nation. As of March, Macy's had 481 Macy's locations, including 25 in New Jersey.

Saunders, the real estate analyst, said the small-format stores would have a "limited" impact on Macy's performance given how few of them exist.

Prime real estate for Macy's

When Bed Bath & Beyond declared bankruptcy this spring, it raised the question of what would replace the retail sites.

Bed Bath & Beyond “always had good-quality, well-located space,” Matthew Harding, chief executive officer of North Plainfield-based Levin Management Corp., a commercial real estate services firm, said in an interview last year.

According to the Asbury Park Press, real estate experts said contenders have included fitness centers and supermarkets, as well as retailers like Marshalls, TJ Maxx, HomeGoods, HomeSense, Sierra Trading Post, Dick's Sporting Goods, Ashley and Burlington Stores.

Burlington Stores is already occupying several former Bed Bath & Beyond locations, including one in Clifton.

Daniel Munoz covers business, consumer affairs, labor and the economy for NorthJersey.com and The Record.

Email: munozd@northjersey.com; Twitter:@danielmunoz100 and Facebook

This article originally appeared on NorthJersey.com: Macy's to open 'small format' store in North Jersey Saturday