Macy’s parent expanding mail order capabilities
Federated Department Stores said it will invest $100 million in 2007-2008 to support continued growth in its direct-to-consumer businesses.
“Our online sales continue to grow at a rapid pace as the national expansion of Macy’s and Bloomingdale’s attracts new customers to our stores, Web sites and catalog,” said Terry J. Lundgren, Federated’s chief executive officer. “In particular, we are seeing exceptional growth in online sales in new Macy’s markets such as Illinois, Michigan, Minnesota, Missouri, Oklahoma, Texas and Utah.
“We anticipate our direct-to-consumer businesses will grow to more than $1 billion in sales by 2008 from about $620 million in 2006,” he said. The company sells products on a variety of Web sites including www.macys.com, and www.bloomingdales.com.
New investments will include the building of a 600,000-square-foot distribution center in Goodyear, Ariz., which will serve primarily as the West Coast shipping point for www.macys.com. Construction on this facility will begin in this spring and is scheduled for completion in spring 2008.
The facility will employ more than 500 full-time associates when completed and fully operational. The Goodyear distribution center is designed to accommodate a future expansion of 400,000 square feet.
Also included in the 2007-2008 capital plan are an expansion of the direct-to-consumer warehouse management system, improvements to the order management system and enhancements to the www.macys.com Web site to support projected increases in customer traffic.
The plans announced this week is in addition to about $130 million being invested in 2006-2007 in direct-to-consumer infrastructure improvements, primarily a new 600,000-square-foot distribution center to open later this month near Portland, Tenn. That facility will serve primarily as the shipping point for www.macys.com to midwestern, southern and central states.
Federated, with corporate offices in Cincinnati and New York, had fiscal 2006 sales of $27 billion. Federated operates more than 850 department stores in 45 states, the District of Columbia, Guam and Puerto Rico under the names of Macy’s and Bloomingdale’s.