Priscilla Zhu/Business Insider
We visited a Macy's Backstage store.
- Macy's is expanding its off-price stores Macy's Backstage and Bloomingdale's The Outlet as part of a three-year revitalization plan announced on February 4.
- According to the plan, the department store will roll out 50 Backstage locations within existing Macy's stores and open seven new standalone locations in 2020.
- Macy's Backstage has a separate buying team, but it also sells overstock from the full-price stores.
- We went to a New York City Macy's Backstage store and found that the majority of items on sale were from lesser-known labels, but in large quantities and with steep discounts.
- Though it's not the ideal place to hunt for deals from big-name and designer brands, it certainly targets a large group of shoppers by offering a storeful of quality goods with super-affordable pricing.
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Struggling against the retail apocalypse, America's biggest department-store chain is banking on its off-price sister store to save it.
On February 4, Macy's announced a three-year revitalization plan in hopes of turning the tide against slumping sales. While the retailer seeks to close 125 of its underperforming stores over the next three years, it also plans to roll out 50 Backstage stores within existing Macy's locations and open seven standalone venues in 2020.
Off-price stores including Macy's Backstage and Bloomingdale's The Outlet have been bright spots in the company's earnings in recent years. Macy's CEO Jeff Gennette said in a 2018 earnings call that Backstage is driving up customers' spending and that visits to Macy's stores offering the model have increased.
Macy's Backstage has a separate buying team and different vendors, but it also sells its full-price stores' overstock, which accounts for a limited portion of its inventory.
We went to a Macy's Backstage store in Elmhurst, New York, to see why the department store is prioritizing its off-price model. We found the majority of items were from lesser-known labels, but with ample stock and great discounts. While we didn't spot many steals from big-name and designer brands, it's clear that the store is looking to target a larger group of customers who want a reliable and affordable shopping destination for some general, good-quality items.
Here's what we saw.