Macy's to roll out 100 Backstage outlets, including on LI
Macy’s is rolling out 100 more off-price outlets within its existing stores this year, including another location on Long Island, as the retailer tries to compete with lower-price retailers.
The fourth Macy’s Backstage on Long Island will open on the lower level of the existing Macy’s in Green Acres Mall in Valley Stream on June 2, the retailer said this week.
Macy's has opened three new Backstage locations in other states so far this year.
Macy’s Backstage sells name-brand clothing, shoes, accessories, housewares and makeup at discounted prices. Macy’s launched Backstage in 2015. There are now 55, and most are located within other stores.
Like many department stores, Macy’s has struggled in recent years with declining sales, as it lost customers to internet retailers and off-price competitors.
“Backstage is Macy’s answer to the off-price retailers, such as TJ Maxx or Ross stores, which have gained tremendous popularity with consumers because they’re offering recognized . . . fashion brands at about half the price of the normal full price,” said Bill Dreher, research analyst at Susquehanna Financial Group in Manhattan. (Susquehanna or its affiliates own at least 1 percent of the retailer’s shares.)
Of the three existing Backstage locations on Long Island, one is inside a Macy’s in Westfield Sunrise Mall in Massapequa and two are separate stores at the Lake Success Center in New Hyde Park and Melville Mall in Melville.
The new Valley Stream outlet will occupy 14,900 square feet inside a 397,000-square-foot Macy’s, spokeswoman Bailey Thomas said.
Macy’s sales in the last fiscal year fell by $1 billion to about $25 billion. Since 2015, the chain has closed 124 stores.
The retailer has, however, found success in its Backstage stores. When they are located inside Macy’s stores, the outlets lift overall sales by 7 percentage points, Thomas said.
Backstage competes with high-end retailers’ off-price offerings, such as Nordstrom Rack and Saks Off Fifth, and helps Macy’s clear excess inventory, said Neil Saunders, managing director of retail at GlobalData, a Manhattan-based market research firm.
Analysts have concerns that as Backstage expands and becomes more well-known, it will cannibalize sales from full-price Macy’s stores, Dreher said.
“I think it’s great for customers. . . . It brings great brands to customers at a significant discount, but I’m not sure it’s good for the company,” he said.
Yaphank resident Sarah Schlie, 43, who shopped at the Backstage in Melville on Thursday, said she finds great deals — she paid $40 for a Catherine Malandrino purse originally priced at $98 — but doesn’t find the stores easy to shop.
“It’s rows and rows of items and you have to look at everything to find something you might like,” said Schlie, who said the layout was similar to those of TJ Maxx and Marshalls.
Shopping at Backstage can be a mixed bag because the selection of items isn’t as plentiful as Macy’s, Dix Hills resident Andria Moodie said Thursday after leaving the Backstage in Melville.
But it still has appeal, she said.
“I look for good prices,” said Moodie, who said she would be willing to shop at the new Valley Stream location, too.
Cincinnati-based Macy’s Inc. operates more than 690 department stores under the Macy’s and Bloomingdale’s names, and about 160 specialty stores that include Bloomingdale’s The Outlet, Bluemercury makeup stores and Macy’s Backstage.