Follow Slashdot stories on Twitter

 



Forgot your password?
typodupeerror
×
Businesses United States IT

Did Remote Working Doom a San Francisco Macy's? (sfstandard.com) 215

"These days in San Francisco, every major business closure triggers a rush to assign blame," argues the San Francisco Standard: When Macy's announced this week that it would shutter its flagship store in Union Square, it unleashed a wave of mourning and recriminations... Mayor London Breed and other local pols like state Sen. Scott Wiener tried to allay fears that Macy's was leaving because of crime, noting the planned closure is one of 150 nationwide. But in a tough election year, it seems few had the appetite to listen to her call for nuance...

The unavoidable truth is the pandemic hollowed out downtown San Francisco's offices and led to an exodus of tech staffers who preferred remote work. It meant the loss of thousands of people who had reason to regularly stroll by Macy's and so many other corporate retailers. Meanwhile, everybody else had even less reason to go shopping in an urban core. Why bother dressing up and schlepping downtown when you could get the same layaway deals online...? [R]etail has been recovering. But it should be no surprise that the recovery has happened largely in suburban markets, which have not experienced a mass exit of workers... Elsewhere, the reality is simple: Malls and department stores have been dying for the last decade, struggling to attract young people and redevelop growing vacant space into desirable uses.

Although Macy's is a legacy name, industry reports show it has been in a real doom loop of its own making. Everyone is angry about retail "shrinkage," an industry term for losses in inventory due to external theft, employee theft and mismanagement. However, reporting by CNBC and others has demonstrated that while corporate retailers may be seeing a bump in retail shrink, it is a smaller factor than other operational missteps. Industry experts suggest that "shrink" can be an excuse for poor inventory management and staffing issues, and brands like Lowe's, Foot Locker and Walgreens are now downplaying organized theft as a primary cause of revenue loss. The reality is that a swath of American retail chains have needed to downsize to remain profitable... [R]eactionary cries for police crackdowns on petty theft and homelessness miss how similar retail shutdowns are happening in cities with tougher crime laws and less visible poverty. Consider that Macy's has already conducted layoffs and cut employee benefits to remain afloat, triggering a worker strike in 2022. Then there's Macy's faltering credit card revenue, which the company said accounted for nearly triple the revenue loss as retail shrink.

While The Standard has reported on Macy's workers blaming theft for the closure, my own visit to Macy's on Tuesday and conversations with longtime sales associates in multiple departments suggested that low staffing, an aging clientele and dips in seasonal shopping have greatly affected business...

Turns out, "scary people stealing things" is a boogeyman that feels more tangible than the obscure machinations of a faltering corporation.

The San Francsico Standard itself was funded in part by billionaire venture capitalist Michael Moritz of Sequoia Capital...
This discussion has been archived. No new comments can be posted.

Did Remote Working Doom a San Francisco Macy's?

Comments Filter:
  • by VeryFluffyBunny ( 5037285 ) on Sunday March 03, 2024 @08:47AM (#64285940)
    As Betteridges law of headlines goes.

    More likely mismanagement & "financialisation" eating away at revenues.
    • More likely the cost of real-estate vs the actual market to sell to. Management decisions are likely a secondary, albeit critical reality.

    • More likely mismanagement & "financialisation" eating away at revenues.

      Correct. My local Macy's shut down about a decade ago. I saw the writing on the wall long before that. Their men's selection kept shrinking both in the size of the men's area compared to women's and overall selection. There was less and less each year and they started putting in their own low-quality clothes.

      This week they announced they were shutting 150 more stores and working on improving the "experience". Fuck experience. Pu

      • by XXongo ( 3986865 )
        Which is pretty much what the article says. It starts out with the statement "every major business closure triggers a rush to assign blame," and goes on to "industry reports show it has been in a real doom loop of its own making."

        The truth seems to be that it's a lot of factors working together that took down Macy's. Fewer people in downtown workdays is one of them, but only one, and not the big one.

      • by quetwo ( 1203948 )

        Our local Macy's -- which was super small to begin with (only one floor, at the smaller end of a dying mall), has a single 'room' for the Men's section. Maybe 100' by 100', and includes the suits, teens, underwear, colognes, etc.

        Oh, you wanted a pair of shoes? Hope you like one of the four they have at the store. Looking for a spring jacket? They sell one -- and it's the same one they sell at Dick's Sporting goods.

        They got rid of the home, kitchen and bedding sections and turned it into what I can only

      • Macys would have to come up with a lot of money to stuff their stores with items that may or may not sell. I don't think they have that money to do so. Unless they go and issue debt specifically for this reason they just plain cannot do it. In addition, their merchandise is seasonal. Stuffing the stores with stuff that may not sell and that they would have to sell at cost or at a loss is also not something they can afford. Add to that the cost of their real estate in property taxes, etc and they are hosed.
        • Macys would have to come up with a lot of money to stuff their stores with items that may or may not sell.

          Macy's has adopted a hybrid nature for some stores, they also act as local distribution centers for their online business. I have one locally and their deliveries are pretty fast. I suspect they farm and the very local stuff to use drivers or something.

          People just don't shop in person anymore, I know GenZ does not. GenX still does. Millenials, who knows. The demographics are against them.

          As they grow older, can no longer afford gym memberships, they will rediscover "malls" as free air conditioned spaces where they can get their steps in for the exercise program. And hookup with the other seniors. They will eventually develop social skills as

      • Re: (Score:3, Insightful)

        Penney's used to give good value on products with good enough to excellent quality and durability, and low-mid market pricing. Eventually, the nice all-cotton Saint John's Bay products degraded to thinner polyester blends. The most glaring degradation, apart from having only 5 sizes of trousers in stock, was the zippers getting shorter, requiring a lift-and-extract to pee, and assuring leakage onto the trousers. Shirts got shorter, requiring a visit to the declining Large and Tall department to find a sh

    • Re:Probably not (Score:5, Insightful)

      by Brett Buck ( 811747 ) on Sunday March 03, 2024 @05:45PM (#64286904)

      Anything to avoid responsibility for letting it turn to sh*t. Being accountable is the left's kryptonite.

  • Um (Score:2, Insightful)

    If by that you mean that losing a captive shopping audience who really didn't want to be in your crime ridden city if they didn't have to be, then maybe. Because that's the only way your theory could work.

    Nice to see you be clueless enough to admit it, though.

    • Re: Um (Score:5, Insightful)

      by fullgandoo ( 1188759 ) on Sunday March 03, 2024 @09:37AM (#64286002)

      Most brick and mortar stores will eventually disappear. They can't compete with online retailers.

      I have been buying all my clothes online for some time now. Way more variety and I get my exact size. Plus cheaper.

      Crime is probably not the driving factor.

      • Re: Um (Score:4, Insightful)

        by Ritz_Just_Ritz ( 883997 ) on Sunday March 03, 2024 @11:16AM (#64286144)

        Oh please....crime is a significant "force multiplier" on why people don't want to be downtown. Sure, a captive audience of officer workers nearby may have delayed the inevitable for a time, but people just don't want to be in that area and experience the filth and the crime. That applies to shopping AND working.

        And it's not just Macy's. Until the city pulls its head out of its ass and creates an environment where people WANT to spend their time and dollars, it's all over but the shouting. As long as the voters are enabling the politicians who are allowing this to continue, I see little hope of improvement.

        • I wasn't talking specifically about downtown stores. My comment was about brick and mortar stores in general. They are facing stiff challenges from online retailers and I can't see anyway they can be price competitive. They are shutting down even in suburbs. But yes, crime might be an issue in some downtowns. Couple that with low office occupancy and hence lower foot traffic.

          • by Ichijo ( 607641 )

            Brick and mortar stores act as showrooms and fitting rooms which benefit online retailers, so brands who want to stay relevant need to subsidize them from online sales.

          • I wasn't talking specifically about downtown stores. My comment was about brick and mortar stores in general. They are facing stiff challenges from online retailers and I can't see anyway they can be price competitive.

            They only need to be price reasonable. They can compete on convenience and service.

            Most recent thing I bought on-line: A pool cue. I bought it on-line, through Walmart.com. Sold and shipped by Southern Billiards, Inc. - which - guess what? Is a brick and mortar store in Atlanta.

            Fun fact: first cue they sent me seemed to have been lost in the mail. They sent another 2nd day air to ensure I had something for my child's birthday, at their own expense! If I lived in the Atlanta area - guess what brick &

        • Re: Um (Score:4, Insightful)

          by AmiMoJo ( 196126 ) on Monday March 04, 2024 @08:08AM (#64287838) Homepage Journal

          So what is your solution to the crime?

          Police budgets are already at insane levels. Anything that addresses the problems like homelessness and poverty can't be done because it's socialism.

          It seems like the politicians are between a rock and a hard place. The electorate demands they fix crime, but is terrified of the solutions.

      • Nobody gets mugged at gunpoint in their home, and nobody is going to willingly go to an area where they think they're going to get mugged at gunpoint or have their car smash and grabbed, so they stay home and feed Amazon.

        The malls that I see that are thriving are swarming with security visible both inside and out. Crime is at a absolute minimum and retailers are packed. The dying malls around here have to cut costs, and one of the first things they lax on second only to building maintenance is security. Cri

      • Most brick and mortar stores will eventually disappear. They can't compete with online retailers.

        Sure they can, If I want something RIGHT FUCKING NOW, on-line isn't going to cut it. Example: two nights ago when I went out at 9:00 PM to get my wife some NyQuil. Another example: when I was working on my Jeep and snapped a bolt off, and went to a local auto store to get a solution. Another example: Jeep battery died. Hopped in the car and went to Costco to get one.

        And good luck getting a sheet of plywood from Amazon delivered for anything approaching a reasonable cost. In the meantime, I can scoot right down to Lowe's and pick one up.

    • Spoken like someone who has never seen a coin operated shopping cart. I bet the city would fill you with wonder if you ever got to one.

  • Time to move on (Score:4, Informative)

    by korgitser ( 1809018 ) on Sunday March 03, 2024 @08:52AM (#64285950)
    Downtown is obsolete. Time to let go and move on. To everyone who got left holding a bag of real estate, suck it up, you are probably going to buy a bailout anyway.
    • While this is the correct answer, when have the powerful people who stand to lose ever just "let go and move on"?

      The buggy whip makers didn't let go when the automobile was invented. The record companies still haven't let go in the face of the internet. Likewise, the owners of the chain stores in the downtown areas of cities like San Francisco, along with the real estate owners and middle-manager PHBs, aren't going to just lie down for WFH.

      Far easier to try and cruise on institutional momentum and fight the

    • Re:Time to move on (Score:5, Insightful)

      by DarkVader ( 121278 ) on Sunday March 03, 2024 @11:31AM (#64286168)

      Downtown isn't obsolete, far from it.

      Offices are obsolete. Downtown is where people want to live.

      Department stores are obsolete. Grocery stores are very much not. Restaurants are very much not. Specialty shops are very much not.

      Office buildings need to be turned into housing - with home offices, because that's the future.

      • Office buildings need to be turned into housing

        Correction: Office buildings need to be turned into mixed-use development. Just concentrating a bunch of people living in a place is not a good idea either.

        You know, a building with a shopping centre, restaurants, housing, and flex rent office space all in one.

        • I'm not convinced of there being much need for flex rent office space, but other that that you are correct, it does need to be mixed use. There's not much point in having residential on the ground floor.

      • Sure, but. If the new downtown pretty much only has location and name in common with the old one, does it make much sense to consider it the same thing?

        Whether downtown can be turned residential is yet to be seen. Yes, people are scrambling to do it, this is the only hope to not end up writing off the real estate. But an office tower has not been built with tower block needs in mind. Most importantly, many office towers have a much lower circumference/floor area ratio, which in a residential setting creates

      • by Morpeth ( 577066 )

        "Downtown is where SOME people want to live" FTFY

        Same goes for the rest of your overly broad generalizations, you should have just said "I think" or "for me personally"

    • Re:Time to move on (Score:5, Insightful)

      by Lehk228 ( 705449 ) on Sunday March 03, 2024 @01:00PM (#64286302) Journal
      downtown doens't have to be obsolete but it can't be both a place where people go for work and shopping and also a combined open air asylum, homeless camp, and drug market.
    • Downtown is obsolete. Time to let go and move on. To everyone who got left holding a bag of real estate, suck it up, you are probably going to buy a bailout anyway.

      No, downtown will become cheaper. And locating light manufacturing in urban areas will once again become plausible. Which would be a good thing, jobs for the working class not high privilege tech bros.

      • by ghoul ( 157158 )
        Its a global economy. Almost everyone in the US is a high privilege person compared to rest of the world. Even the homeless guy has it better than 80% of the world. And its these people you are competing with for manufacturing jobs. Unless its high tech manufacturing which means babysitting robots, no manufacturing is coming to the US till the US is a lot poorer or the world a lot richer.
        • by dryeo ( 100693 )

          Do you really think the homeless guy living in a tent or under a tarp in the snow has it better then 80% of the world?

    • I was in the US recently, and it seems downtowns are doing better than they did compared to when I lived in the US in the 90s. Times change, and people want to live downtown for many reasons. The current situation will also change, and I think people will continue to want to live there. Maybe it will have to get cheaper first, but that adjustment will happen.

  • You might have noticed that all the mail-order shops are gone and got replaced by online shopping places.

    Get out of the way of progress, hackneys, nobody needs you anymore.

    • A large number of this online shops by volume, places like Amazon and the new up and coming Temu work by selling blatantly illegal imports then disclaiming all responsibility while taking a healthy profit.

      If the choice was Amazon or a department store, I'd choose the latter every time because I value not being electrocuted while my house burns down...

      Actually come to think of it, I do shop are department stores. Sometimes it's useful to see things in person. Sometimes it's useful to have something now. Some

  • by drinkypoo ( 153816 ) <drink@hyperlogos.org> on Sunday March 03, 2024 @09:11AM (#64285976) Homepage Journal

    I for one do not want to drive around looking for stuff and then either settle for what they have or for nothing, I want to research what is the best product for me at my price point and then buy it. Everybody hates working retail anyway. Let's be more efficient.

    • There are still some cases for an actual store. The last time I bought a mattress I went to a place where there is a showroom, but most of the building was the "factory" where they manufactured the mattresses. It was great as an experience because I could try a few things out so they could build it to my specifications and it's difficult to online shop for something like a mattress. Once they had it finished a few weeks later I could come back and try it again to make sure it was good before receiving it. I
      • The last time I bought a mattress, I ordered it online. It's better than any mattress I've seen in a store in decades, those all have horrible metal springs in them, this one doesn't, it's comfy foam all the way through. And it was about $200, not thousands. The only thing I've ever seen that was better was one of those sleep number beds, and that's because those can be actively cooled and you can make adjustments yourself, depending on what you want at that moment. Out of my price range, but also can b

    • I for one do not want to drive around looking for stuff and then either settle for what they have or for nothing, I want to research what is the best product for me at my price point and then buy it. Everybody hates working retail anyway. Let's be more efficient.

      Efficient? Ever consider the fact your entire retail life and needs are going to be at the whim of shipping and handling? You won’t get stuff online in an hour for an event tonight. You will have nothing at that moment. Except a fading memory of retail reminding you of what convenience used to be.

      I truly have no idea how FOMO McLastMinute is gonna handle it when they realize the new-and-improved way might be feeding that whole Missing Out problem. We’re a long way off from delivering procra

      • Except a fading memory of retail reminding you of what convenience used to be.

        Clearly your memories of retail have faded, and you're remembering it nostalgically. At least nine times in ten when I go out shopping for some particular thing, it's nowhere to be found and I either wind up with something I didn't want, or coming home and ordering the thing. Trying to find out over the phone whether the stores have what I want is often even more frustrating than that. They don't know, they don't want to know, and it takes an age to even get through to someone who doesn't know.

        There are a f

  • My story. (Score:4, Interesting)

    by Petersko ( 564140 ) on Sunday March 03, 2024 @10:09AM (#64286038)

    I got absolutely screwed when I bought a condo before it had been constructed. 2008, close to downtown. Stayed in it too long, found out the builder fucked us, and we were on the hook for massive costs to fix the envelope. Rather than pony up $65,000, and having no mortgage, I sold the unit to somebody willing to assume the debt, and took a major loss, getting less than half of what I paid for it. Best possible decision. Not only are the costs to remediate growing larger, but the value of the unit when fixed is dropping as downtown real estate prices collapse. My willingness to write off the property saved me from this boat anchor.

    These events didn't torpedo my financial life. I was free and clear, so while there was a loss on paper, it did not impact my life in any meaningful way. But in my building were tons of young people for whom the equity in their home was nearly their entire net worth, and they are stuck there for the foreseeable future, completely underwater.

    The people owning homes in our downtown are in for some serious heartache. I don't weep for the speculators... that's why it's called speculation. I feel for those young, first time buyers who get to start not from zero... but from a negative position.

  • by TwistedGreen ( 80055 ) on Sunday March 03, 2024 @10:41AM (#64286086)

    I think more likely it's Amazon that's the root cause.

  • by Baron_Yam ( 643147 ) on Sunday March 03, 2024 @10:48AM (#64286098)

    Is it WfH cutting more foot traffic? Local crime rates (which will be correlated to some degree to the declining local economy)? General death of bricks & mortar retail due to online shopping?

    It will be all of these things, and more. And very likely at least two of them will have enough of a share of responsibility for the outcome that you can't point at just one and say, "That's it, that's the reason".

  • by aaarrrgggh ( 9205 ) on Sunday March 03, 2024 @11:05AM (#64286120)

    What killed Macy's Union Square was the destruction of tourism from within and without. This allowed the Tenderloin to push towards Union Square, and eliminated a large number of shoppers. That created a death spiral for the area. I would guess that recovering Union Square is going to take more than fixing the situation in the financial district. Macy's was always the anchor for the area, so its loss will have much more profound impact on any future recovery. All the Union Square-adjacent areas have already fallen back to what they were 30 years ago.

    It will be an uphill battle to restore tourism, bring back retail, and eventually get the office space absorption that is needed to keep FiDi and SoMa viable. Overstated stories of doom, crime, and homelessness just make the prospects harder.

    • What killed Macy's Union Square was the destruction of tourism from within and without. This allowed the Tenderloin to push towards Union Square, and eliminated a large number of shoppers. That created a death spiral for the area. I would guess that recovering Union Square is going to take more than fixing the situation in the financial district. Macy's was always the anchor for the area, so its loss will have much more profound impact on any future recovery. All the Union Square-adjacent areas have already fallen back to what they were 30 years ago.

      The spread of Tenderloin was because of the BLM / Defund police movement along with the now recalled San Francisco District Attorney known for being far too soft on crime, not because there were less tourists.

      That spread of crime and covid had a large impact on the retail health in SF. My recent travels outside of the US has not seen anywhere near this level of destruction.

      • by ghoul ( 157158 )
        When I used to live in San Jose and relatives from out of country would visit I would take them to the Golden Gate and to the Pier but I would never take my own car. Drive till the Airport station , park it there and take the Bart into the city and use the trolleys to go from tourist spot to tourist spot. Taking your car into the city means either paying exorbitant parking fees or having your car broken into if you use metered street parking. SF has been a POS for tourists since 2018 well before BLM.
        • by dfm3 ( 830843 )
          I'm a tourist from the east coast. I've been to SF a couple times over the last 20 years, and I have to say that I honestly didn't find much to do in the city that needed more than a solid day or so. Then everything is so damn expensive from my non-California point of view, and eventually you want to see stuff that's farther out (Napa Valley, the coast, etc) but if you ride back to the airport to rent a car (I would never drive into downtown) you then have to deal with all the traffic and long bridges with
    • What killed Macy's Union Square was the destruction of tourism from within and without. This allowed the Tenderloin to push towards Union Square, and eliminated a large number of shoppers. That created a death spiral for the area. I would guess that recovering Union Square is going to take more than fixing the situation in the financial district. Macy's was always the anchor for the area, so its loss will have much more profound impact on any future recovery. All the Union Square-adjacent areas have already fallen back to what they were 30 years ago.

      It will be an uphill battle to restore tourism, bring back retail, and eventually get the office space absorption that is needed to keep FiDi and SoMa viable. Overstated stories of doom, crime, and homelessness just make the prospects harder.

      I was in the area recently for a conference, there were office buildings on either side of the hotel, outside of ground floor tenants I didn't see a single person in either of them.

      Tourists are generally there to see and experience stuff, not shop at an upscale department store and fill up their luggage with things to bring home (there are exceptions of course).

      If you have an upscale department store you need wealthy locals to shop there, not tourists, if you have a lively downtown district you need locals

  • The headline assumes that people had the time to go shopping during the work day. Granted, a lot of people's work ethic results in two-hour lunches where shopping might take place but still. Maybe remote work was a factor but it sure as well wasn't the only one. The cost of doing business there was too high. It's as simple as that.

    • Yeah, and it's not as if brick-and-mortar retail hasn't been in significant decline during the past two decades either. It's just that the downtown landlords, business CEOs, and city governments have largely stayed in denial until the bottom completely fell out and they couldn't ignore it anymore.

  • by fuzzyfuzzyfungus ( 1223518 ) on Sunday March 03, 2024 @01:42PM (#64286418) Journal
    This seems like a pretty tenuous theory. There's a reasonably solid suspicion when businesses with clear connections to the cube farms, like restaurants and coffee places whose main draw is proximity to offices(and, typically, because of the way the zoning shakes down, significantly less proximity to things that aren't offices) are involved that people no longer seeing them as convenient, because they aren't in the office, or requiring their convenience, because it's a lot easier to make your own coffee when you don't have a commute.

    This is a department store though: furniture, clothing, cosmetics, jewelry, housewares of various sorts. Am I claiming that literally nobody has ever popped over in an emergency after spilling coffee on their pants; or that it has never benefitted from being more convenient because it's on the way home from work? No, that sort of thing must happen at least occasionally. Do I buy that people drawn to the area by the fact that they work there are the primary audience for those sorts of (more typically) planned purchases? That seems like a hard sell.
  • by strike6 ( 823490 ) on Sunday March 03, 2024 @01:47PM (#64286432)
    And there may be some truth to that. But I was in SF about a year ago for a conference and went to Walgreens for some toiletry items I had forgotten. At least 50% of the store was behind locked doors, including simple things like razor blades. The PA system was constantly blaring "customer service needed on aisle x" to get these simple items for customers. The 2nd day I was there I passed by the same Walgreens and one of their glass entrance doors was gone, replaced with a big piece of wood. i assume it was busted overnight. I tried to go to Marshalls to get a belt but there was a line halfway down the block because they were limiting how many people could be in the store at the same time. I'm not saying Macy's doesn't have other issues, but to downplay crime as a factor is disingenuous.
  • Amazon?
  • What turns people off a bout shopping in San Francisco, which used to be a major tourist activity, is not the low probability that they will happen to be at Nordstrom's when the flash mob storms through and cleans the place out. It'a the much higher probability that their car will be broken into - or carjacked - before they can get their purchases home.

    When you were little, the monster hid under your bed. Today, it's in the parking garage.

  • Other cities around the world are not experiencing the 'doom loop' that SF is currently. So no, its not remote work. Downtowns of other cities around the world are just fine, even today.

    I go to SF often for work. Rents are still (extremely) high, so lots of people live there, and want to live there, even today. Heck, if I could afford it, I'd go live there.

    However... in the business districts, like where this Macy's is, is a (very) serious drug (meth, fentanyl in particular) addition problem, which causes c

  • by Roogna ( 9643 ) on Sunday March 03, 2024 @03:44PM (#64286640)

    Macy's used to be a nice store. It, like basically every other store of its type decided to over the last two decades become cesspools of crappy products. That's why they're failing. It's got nothing to do with office workers.

  • long before Covid happened, even when I worked downtown. Too expensive, too much of a hassle finding what I wanted, and I stopped finding clothes I was interested in. The doom loop didnâ(TM)t do them any favors, but Macyâ(TM)s problems extend beyond remote work.
  • The city just needs the property to expand the Tenderloin district.

    You have to please your constituency.

Life is a healthy respect for mother nature laced with greed.

Working...