Building Our Brands… One Customer at a Time.

Transcription

Building Our Brands…
One Customer at a Time.
FEDERATED DEPARTMENT STORES, INC.
Corporate Fact Book
2007
Federated Contacts
Media: Jim Sluzewski ...............................................1-513-579-7764
Investor: Susan Robinson .....................................1-513-579-7028
Transfer Agent: Bank of New York......................1-866-337-3311
Toll Free Information Request Line...................1-800-261-5385
Federated Corporate Web Site .................................www.fds.com
Fiscal Year 2007-2008
Calendar of Public Disclosures
Note: All dates are subject to change.
Monthly Sales Announcements
Fiscal 2007
Sales
Release Dates
Fiscal 2008
Sales
Release Dates
February
3/8/07
3/6/08
March
4/12/07
4/10/08
April
5/10/07
5/8/08
Month
May
6/7/07
6/5/08
June
7/12/07
7/10/08
July
8/9/07
8/7/08
August
9/6/07
9/4/08
September
10/11/07
10/9/08
October
11/8/07
11/6/08
November
12/6/07
12/4/08
December
1/10/08
1/8/09
January
2/7/08
2/5/09
Quarterly Results
Three Months
Ended
2007 Earnings
Release Dates
10Q/10K
SEC Filing
5/5/07
8/4/07
11/3/07
2/2/08
5/16/07
8/15/07
11/14/07
2/26/08
6/11/07
9/10/07
12/10/07
4/2/08
Three Months
Ended
2008 Earnings
Release Dates
10Q/10K
SEC Filing
5/3/08
8/2/08
11/1/08
1/31/09
5/14/08
8/13/08
11/12/08
2/24/09
6/9/08
9/8/08
12/8/08
4/1/09
The Fact Book contains certain forward-looking statements that reflect current views of the future financial performance and
other events of Federated. The words “may,” “will,” “could,” “expect,” “plan,” “anticipate,” “believe” and other similar expressions
identify forward-looking statements. Any such forward-looking statements are subject to risks and uncertainties. Future results
or outcomes could differ materially from current expectations due to a variety of factors that affect the company, including
competitive pressures from specialty stores, general merchandise stores, manufacturers’ outlets, off-price and discount stores,
new and established forms of home shopping (including the Internet, mail-order catalogs and television) and general consumer
spending levels, including the impact of the availability and level of consumer debt, and the effect of weather and other factors
identified in documents filed by the Company with the Securities and Exchange Commission (SEC).
1 | FEDERATED DEPARTMENT STORES, INC.
Calendar of Public Disclosures .......................................................................................IFC
Financial Highlights ................................................................................................................2
Federated-At-A-Glance..........................................................................................................3
Corporate Vision, Philosophy and Objectives.............................................................4
Building Our Brands … One Customer at a Time......................................................5
Strategic Priorities...............................................................................................................13
2006 Highlights and Recent Developments .............................................................19
Federated Approves 2-for-1 Stock Split ................................................................................20
Federated Completes Credit Card Portfolio Sales to Citi ................................................20
Federated Launches National Campaign .............................................................................21
Federated Sells Lord & Taylor, and Bridal Group ................................................................21
Martha Stewart Collection: Exclusively at Macy’s.............................................................22
Wedding & Gift Registry..............................................................................................................22
Federated Increases Company’s Stock Buyback Program..............................................24
Federated Plans Corporate Name Change...........................................................................24
Macy’s......................................................................................................................................25
Bloomingdale’s.....................................................................................................................35
Attracting and Developing Talent.................................................................................41
Demonstrating Leadership..............................................................................................47
A Diverse and Inclusive Organization ....................................................................................48
Helping Our Communities .........................................................................................................51
Social Responsibility.....................................................................................................................62
Financial Overview .............................................................................................................63
Division Review....................................................................................................................71
Retail Operations
Bloomingdale’s ...............................................................................................................72
Macy’s East.......................................................................................................................74
Macy’s Florida .................................................................................................................78
Macy’s Midwest..............................................................................................................80
Macy’s North ...................................................................................................................82
Macy’s Northwest..........................................................................................................84
Macy’s South ...................................................................................................................86
Macy’s West .....................................................................................................................90
macys.com........................................................................................................................94
Support Operations
Macy’s Home Store .......................................................................................................96
Federated Corporate Services ..................................................................................97
Federated Logistics and Operations ......................................................................97
Federated Systems Group..........................................................................................98
Financial, Administrative and Credit Services (FACS) Group.........................99
Macy’s Corporate Marketing .....................................................................................99
Macy’s Merchandising Group.................................................................................100
Federated/Macy’s/Bloomingdale’s History..............................................................101
Board of Directors/Corporate Management ..........................................................111
Shareholder Information ...............................................................................................115
Stores By State ...................................................................................................................116
2007 CORPORATE FACT BOOK | 1
Financial Highlights
2006
2005
2004
Net Sales
Change in same-store sales (Note 1)
$ 26.970 billion
4.4 %
$ 22.390 billion
1.3 %
$ 15.776 billion
2.6%
Income from Continuing Operations
Before Income Taxes
% of Sales
$
1.446 billion
5.4 %
$ 2.044 billion
9.1 %
$ 1.116 billion
7.1 %
$
1.883 billion
7.0 %
$ 1.758 billion
7.9 %
$ 1.116 billion
7.1 %
$ 1.80
$ 3.16
$ 1.93
$ 2.30
$ 1.81
$ 2.55
$ 3.24
$ 1.93
$ 1.93
Before Income Taxes,
Excluding Certain Items (Note 2)
% of Sales
Diluted Earnings Per Share
Income from Continuing Operations,
Excluding Certain Items (Note 3)
Net Income
Notes:
(1)
Represents the year-to-year percentage change in net sales from Bloomingdale’s and Macy’s stores in operation
throughout the year presented and the immediately preceding year and all Internet sales and mail-order sales from
continuing businesses.
(2)
Represents income from continuing operations of $1.446 billion for 2006, $2.044 billion for 2005 and $1.116 billion for
2004 adjusted to exclude the effects of inventory valuation adjustments related to the May integration of $178 million
in 2006 and $25 million in 2005, May integration costs of $450 million in 2006 and $169 million in 2005 and the gains
on the sale of accounts receivable of $191 million in 2006 and $480 million in 2005.
(3)
Represents income from continuing operations per diluted share of $1.80 for 2006, $3.16 for 2005 and $1.93 for 2004
adjusted to exclude the diluted earnings per share effects of the May merger integration costs and related inventory
valuation adjustments of $.72 in 2006 and $.28 in 2005 and the gains on sale of accounts receivable of $.22 in 2006
and $.89 in 2005.
The foregoing financial highlights should be read in conjunction with the audited financial statements, including the
related notes and other financial information contained in the Form 10-K for the period ending Feb. 3, 2007.
Federated At-A-Glance
Federated Department Stores, Inc. is one of America’s premier national retailers, operating more
than 850 Macy’s and Bloomingdale’s stores in 45 states, the District of Columbia, Guam and
Puerto Rico. The company also operates macys.com, bloomingdales.com and Bloomingdale’s By
Mail. Federated’s diverse workforce includes approximately 188,000 employees.
Retail Divisions
Bloomingdale’s
Headquarters: New York, NY
Bloomingdale’s By Mail, bloomingdales.com and
38 stores in California, Florida, Georgia, Illinois,
Maryland, Massachusetts, Minnesota, Nevada,
New Jersey, New York, Pennsylvania and Virginia.
Annual 2006 sales of $2.317 billion
Macy’s East
188 stores in Connecticut, Delaware, Maine, Maryland,
Massachusetts, New Hampshire, New Jersey, New York,
Pennsylvania, Rhode Island, Vermont, Virginia,
Washington, D.C., and Puerto Rico.
Macy’s Florida
Headquarters: Miami, FL
61 stores in Florida.
Macy’s Midwest
Headquarters: St. Louis, MO
113 stores in Illinois, Indiana, Kansas, Kentucky, Missouri,
Ohio, Pennsylvania, West Virginia and western New York.
Macy’s Northwest
Headquarters: Seattle, WA
68 stores in Idaho, Montana, Oregon, Utah,
Washington and Wyoming.
Macy’s South
Headquarters: Atlanta, GA
134 stores in Alabama, Georgia, Indiana,
Kentucky, Louisiana, North Carolina, Oklahoma,
Pennsylvania, South Carolina, Tennessee, Texas
and Virginia.
Macy’s West
Headquarters: San Francisco, CA
193 stores in Arizona, California, Colorado,
Hawaii, Nevada, New Mexico, Texas and Guam.
macys.com
Headquarters: New York, NY/San Francisco, CA
Macy’s North
Headquarters: Minneapolis, MN
63 stores in Illinois, Michigan, Minnesota, North Dakota,
northern Ohio, South Dakota and Wisconsin.
Support Divisions
Macy’s Home Store
Financial, Administrative & Credit Services Group
Headquarters: Cincinnati, OH
Federated Corporate Services
Headquarters: Cincinnati, OH
Macy’s Corporate Marketing
Federated Logistics & Operations
Headquarters: Secaucus, NJ
Macy’s Merchandising Group
Federated Systems Group
Headquarters: Atlanta, GA
Note: All store counts as of March 3, 2007.
Corporate Vision, Philosophy and Objectives
Corporate Vision
Federated Department Stores, Inc. is a premier national retailer with brands that reflect the spirit of America.
The timeless values that made our nation strong are the same values that make our company strong.
• A belief in the promise of the future with the energy and determination to get us there.
• A belief that our heritage mirrors the optimism, inclusion and integrity that provide for both
stability and growth.
• A belief that taking advantage of the right opportunities will continue to lead us to success in
all that we do.
Corporate Philosophy
Federated clearly recognizes that the customer is paramount, and that all actions and strategies
must be directed toward providing an enhanced merchandise offering and better service to targeted
consumers through dynamic department stores and direct-to-customer retail formats.
Aggressive implementation of the company’s strategies, as well as careful and thorough planning,
will provide Federated’s department stores with an important competitive edge.
Federated is committed to open and honest communications with employees, shareholders, vendors,
customers, financial analysts and the news media. The company seeks to be proactive in sharing information and in keeping these key stakeholder groups up-to-date on important and material developments.
At Federated, our greatest strength lies in the skill, judgment and talent of our people. Every day a
production of enormous magnitude takes place on our selling floors and behind the scenes, where our
people bring the company’s strategic goals to life. Our priority of attracting, retaining and growing the
most talented people in the retail industry has been and will continue to be our greatest advantage.
Corporate Objectives
The objectives of Federated Department Stores, Inc. are:
• To accelerate comp-store sales growth.
• To continue to increase the company’s profitability levels (earnings before interest, taxes, depreciation
and amortization) as a percent of sales to a level of 14 percent to 15 percent in the 2008 – 2009 time frame.
• To effectively utilize excess cash flow through a combination of strategic growth opportunities and
stock buybacks.
• To grow earnings per share while increasing return on gross investment.
Building Our Brands …
Macy’s and Bloomingdale’s are among the most
recognized retail brands in America – and worldwide.
We are known for creating unique merchandise
assortments, operating destination stores, hosting
attention-getting community and fashion events, and
driving innovation in fashion-oriented e-commerce.
While tens of millions of customers visit Macy’s and
Bloomingdale’s each year, we don’t take their business
for granted.
Through ongoing research, our company is identifying
its “core” customers, studying their lifestyles and
striving to mold our merchandise assortments and
store experiences around their needs. Federated’s goal
is to make our stores relevant for each and every
customer, whatever her or his needs and preferences.
Building Our Brands …
This means we sell a broad array of merchandise that
helps individual customers express their personal style.
We tailor the assortments at each store to the customer
who shops there. We strive to provide appropriate levels
of service to all customers and to connect with them
one-on-one.
Our business strategies are supported by the best
people in retailing, in whom we have invested to attract,
develop and retain. We are an inclusive employer whose
strength comes from encouraging diverse viewpoints.
The Macy’s and Bloomingdale’s brands distinguish
Federated as an industry leader. Research shows that
more than 98 percent of American shoppers in our
targeted core customer group already recognize one or
both names. Building these brands – by reaching out to
one customer at a time – is how we will continue to
grow our business and enhance shareholder value.
Building Our Brands … One Customer at a Time.
Defining Our Brands
What makes Macy’s a favorite destination coast to coast? How does Bloomingdale’s
differentiate itself from other upscale retailers? Why do our stores feel “just right”
to so many customers across various segments of society?
The answer lies in listening intently to consumers, applying our learnings to improve the way we do
business, and remaining true to the positioning of each brand in the retail marketplace.
Defining our brands – finding and capitalizing on our “lanes” within the very competitive retail industry –
requires a deep understanding of our customers, their values and the role they want shopping to play in
their lives.
Customers are not alike. And each consumer’s choices and expectations of a favorite store evolve
throughout life. So it’s incumbent upon us to always be listening – and changing – as we identify shifts
in trends, style preferences and shopping habits. In doing so, we can maintain Macy’s and Bloomingdale’s
as separate and distinct brands with their own personalities and growth opportunities based on the
customers they serve.
Listening and Learning From the Customer
As a company, we listen and learn in a number of ways. To begin, we carefully analyze data from sales in our
stores – what’s selling and what’s not in each location. This allows us to make appropriate adjustments in each
store. But more important, now as a national company, we can quickly identify and transplant best practices
from one place to another.
Structured research conducted nationwide – online and in independent settings – allows us to hear what
customers and non-customers think and feel about shopping for the kinds of merchandise sold by Macy’s and
Bloomingdale’s. We learn when, how and why they shop. We
learn how they rate our stores compared with the multitude
of other shopping options. We learn what they like and don’t
like when they walk into our doors. We learn what we can do
to serve them better. And we can test ideas and concepts for
future innovations.
Federated also has a long track record of soliciting
specific customer feedback from daily shopping experiences.
In 2006, we received about 200,000 feedback cards via mail
from credit customers randomly selected from each day’s
transactions at every Macy’s and Bloomingdale’s store. In
addition, more than 400,000 customers accepted our
invitation to e-mail us with their comments after making
a purchase.
In most cases, the feedback we hear is positive – muchappreciated compliments for our stores and associates.
But we pay even closer attention to ideas, questions and
criticisms that indicate what we can do to improve.
Based on comments received via mail and Internet, a
service score is calculated and tracked for each store every
day. Measuring our progress is vital if we are to continue
relationships with all customers.
Creating Great Brand
Experiences
A shopping trip to Macy’s or Bloomingdale’s
should be exciting and convenient for our
customers. We want to be our customers’
first choice. That’s a tall order, and one that
requires dozens of elements to come together
seamlessly every day.
Both Macy’s and Bloomingdale’s are multichannel brands.
Macy’s serves customers nationwide through an extensive
network of stores, as well as the macys.com Web site.
Bloomingdale’s reaches customers through its stores,
bloomingdales.com and the Bloomingdale’s By Mail
national mail order catalog.
Getting Better Every Day
Macy’s and Bloomingdale’s made significant strides in 2006
toward refining their individual brand experiences, even
while significantly expanding their size and presence in the
marketplace.
Creating a great brand experience at Macy’s and
Bloomingdale’s means we have the right assortments –
unique and well-edited merchandise selections that are
tailored to fit the needs of customers who shop each and
every store. Our store environments must be attractive
and inviting, befitting an upscale retailer. Our service must
be appropriate for the customer’s needs – friendly, efficient
and knowledgeable.
At Macy’s, the re-branding of more than 400 locations
acquired in late 2005 from The May Department Stores
Company was underscored by the launch of an extensive
program of store improvements that included widening
aisles, reducing clutter, upgrading fitting rooms, installing
wayfinding signage and enhancing visual presentation
of merchandise to better demonstrate coordinated looks
and outfits.
The Macy’s brand experience is brought to life through
continued implementation of the four strategic priorities
that have unwaveringly guided the growth in this business
for the past five years – Distinctive Assortments, Simplified
Pricing, Improving the Shopping Experience and
Compelling Marketing.
On Sept. 9, 2006, more than 800 Macy’s stores welcomed
customers across America – making Macy’s the first
nationwide fashion department store.
Bloomingdale’s also continues to focus on its strengths as
an upscale retailer serving a more contemporary customer
through exceptional stores in select urban markets.
Concurrently, merchandise assortments continued to
improve and expand, with special emphasis on unique
merchandise. This includes Macy’s widely recognized private
brands, such as I·N·C, Alfani, Tasso Elba, American Rag,
Karen Scott, John Ashford, Hotel Collection, Greendog and
Tools of the Trade. Market brands exclusive to Macy’s, such
as the T Tahari collection from designer Elie Tahari and
the O Oscar collection from designer Oscar de la Renta,
also have been rolled out. And in fall 2007, an exclusive
new home brand called the Martha Stewart Collection will
debut in all Macy’s stores. In all, more than one-third of all
merchandise sold at Macy’s in 2006 was exclusive or
from limited distribution collections.
The Macy’s story was brought to life in 2006 through
the brand’s first-ever national advertising campaigns.
Throughout the fall and holiday seasons, Macy’s attracted
attention with high-impact ads on broadcast and cable
television, and in national magazines, local newspapers
and radio, outdoor boards and most-visited Internet sites.
Macy’s opened three new stores in 2006, including in
Chula Vista, CA, Denver and downtown Philadelphia. In
2007, new Macy’s will open in Bolingbrook, IL; Boston, MA;
Collierville, TN; and Austin, TX. Macy’s Furniture Galleries
will include a new location in Lake Grove, NY, and a
replacement store in Littleton, CO.
Bloomingdale’s also expanded in 2006 with a spectacular
new 338,000-square-foot flagship store in downtown San
Francisco, a new location in San Diego and a replacement
store in Boston’s Chestnut Hill. Plans call for two more
Bloomingdale’s to open in 2007 – in Costa Mesa, CA, and
Chevy Chase, MD.
Federated’s commitment to enhancing the brand
experience included significant capital spending in 2006
devoted to new and remodeled stores and new technology.
An additional $1.2 billion in capital spending is planned
for 2007.
Strengthening the
Infrastructure
Beyond the storefronts and sales floors,
Federated’s business benefits from some of
the retail industry’s most professional, proficient
and efficient support organizations. We continue
to invest in people, facilities and technology
that add value to the customer’s shopping
experience, as well as improve the corporation’s
financial performance for shareholders.
We have made particular progress in streamlining
logistics, enhancing systems and leveraging credit so we
can reap the benefits of being a larger and more focused
company going forward.
Through the integration of Federated and May Company,
we met our goal of capturing more than $175 million in cost
synergies in 2006. And we’re on track to realize more than
$450 million in annual cost synergies in 2007 and beyond.
This isn’t solely a matter of reducing costs by eliminating
redundancy. Post-merger, Federated is able to take
advantage of doing business on a larger scale. While
reducing overall costs, we are able to invest incrementally
in the best talent, facilities, hardware, software, systems
and business processes – all customized to our specific
business needs.
Federated is becoming a stronger company that is laying
the foundation for increased financial performance in the
years ahead.
Mastering the Details
Examples of innovation abound across Federated’s
support operations.
Federated Systems Group, for example, continues to be
recognized among the nation’s elite corporate technology
organizations. Having completed the integration of
Federated and May Company systems, operations and
platforms, the next technology frontier is to upgrade Macy’s
and Bloomingdale’s point-of-sale systems so transactions
can be faster, more efficient and integrated with customer
service initiatives. Advertising, merchandising and direct-toconsumer systems also are being improved to provide new
levels of information, support the management of larger
sales volume, and help tailor assortments by store.
The company’s Financial, Administrative and Credit
Services (FACS) Group division, which partnered with
Citigroup in 2005, added a fourth hub in St. Louis (the others
are in Cincinnati, Tempe, AZ, and Clearwater, FL) to support
credit programs and customer service across the country.
In part, these facilities support Macy’s Star Rewards, a
robust loyalty program that provides merchandise certificates
and special offers to our proprietary credit customers, with
benefits increasing along with a customer’s level of spending
at Macy’s. Star Rewards was introduced successfully to
former May Company customers in 2006.
Federated Logistics & Operations is realigning the
company’s nationwide network of distribution centers
so each facility is regional in nature. Goods arriving at
a distribution center can be handled with high-speed
equipment, resorted and shipped to our stores within
a matter of hours – instead of days or weeks. This allows
fashion goods to arrive on the sales floor faster and
facilitates increased inventory turn so our assortments
are fresher for the customer.
In addition, in spring 2007, Federated opened a new
600,000-square-foot distribution center near Portland,
TN, specifically to handle orders for our fast-growing
direct-to-consumer businesses such as macys.com and
bloomingdales.com. A similar distribution center will
open in Goodyear, AZ, in spring 2008. These are part of
a $230 million capital investment in infrastructure and
service improvements for these direct-to-consumer
channels in 2006-2008.
Across the company, corporate and support functions
have been fortified to provide detail-oriented management
of a larger business and to provide data and implementation
support for strategic initiatives.
Macy’s Goes National
When the Macy’s brand re-launched nationally
on Sept. 9, 2006, America couldn’t help but
notice. That was the day when more than
400 former May Company stores – operating
under a collection of 11 different nameplates –
converted to the Macy’s brand. For the first time,
Macy’s was a truly national brand operating
coast to coast.
It was a period of excitement and celebration. We hosted
downtown block parties, sponsored major sporting events,
toured the famous Macy’s Thanksgiving Day Parade,
triggered spontaneous dancing in the streets … and made
millions of customers very, very happy as we introduced
Macy’s in a way they had never before seen.
A bold new advertising campaign stood out on TV and in
newspapers, magazines, outdoor boards, computer screens
and mailboxes. Celebrations stretched across major markets
such as Boston, Chicago, Cleveland, Dallas, Denver, Detroit,
Houston, Los Angeles, Minneapolis, Pittsburgh, Portland,
Salt Lake City and St. Louis.
America’s Department Store has arrived.
Creating a New Sensation
Across the Nation
At every new Macy’s store across America on Sept. 9,
customers were greeted with a Hollywood-style red-carpet
celebration to mark the nationwide brand re-launch. The
events featured local bands and orchestras, ceremonial
remarks from public officials, radio station remote
broadcasts, and special events such as cooking
demonstrations and fashion shows. In every store, free
Macy’s gift cards were distributed to help get the
shopping started.
Across the country, local communities benefited from
the Macy’s brand launch activity. On the company’s first-ever
nationwide Give Back Day, volunteers from Federated’s
Partners in Time program gave their time to service projects
related to local children’s charities. In the same period, all
Macy’s stores hosted a “Shop for a Cause” day that raised
more than $9 million for hundreds of local charities.
Together, a Stronger Team
Federated’s integration with May Company provided the
opportunity to strengthen our team with outstanding new
talent across the organization – from divisional senior
management, to store management and sales associates,
to regional buying offices and corporate support functions.
Going forward now, we are a single team of about 188,000
employees focused on serving the customer well, running an
efficient and successful business, and building great brands.
Federated’s commitment to people includes continuing
to work to attract the best individuals to every position,
maximizing their potential through training and
development, listening to their ideas and suggestions,
providing competitive compensation and benefits, and
providing opportunities for ongoing advancement.
Strategic Priorities
Improved Assortments Attract Customers
Merchandise assortments are paramount for fashion retailers like Macy’s and
Bloomingdale’s. More than ever before, our customers are seeing new and
differentiated product in every store. This is being driven by continued penetration
of best-selling private brands at Macy’s and strengthened bridge and designer
businesses at Bloomingdale’s.
More than one-third of Macy’s sales in 2006 came from unique and distinctive product. This included
Macy’s exclusive private brands – such as I·N·C, Charter Club, Alfani, Style & Co., American Rag, Greendog,
Hotel Collection and Tools of the Trade – which reached 18.2 percent of total sales in legacy Macy’s-branded
stores last year. Over the last four years, Macy’s private brands have grown three times faster than market
brands in our stores.
As with our total assortments, private brands at Macy’s are positioned to appeal to the lifestyle needs of our
core customer. We’ve learned that lifestyle – not age, demographics or income – is the key determining factor
in what customers buy, how they shop and the value they expect.
Macy’s also works closely with market vendors to bring its customers exclusive and limited distribution
merchandise. Status brands and strategic partnerships with successful designers are part of the history and
heritage of Macy’s and Bloomingdale’s.
The company’s long-standing relationships with status brands and designers such as Calvin Klein, Coach,
Esteé Lauder, Kenneth Cole, Michael Kors, Nautica, Sean John, Ralph Lauren and Tommy Hilfiger are built on
a deep, mutual respect and a compelling desire to give customers fashion and newness.
More Tailored Assortments
Each store is planned to reflect the lifestyle and preferences
of the customer who shops there.
In part, Macy’s and Bloomingdale’s are trading up their
businesses. On the scale of good-better-best, the proportion
of upscale “best” merchandise sold by Macy’s rose in 2006.
Concurrently, the proportion of opening-price-point “good”
merchandise declined.
Bloomingdale’s also continues to emphasize
contemporary fashions in an accessible upscale store
environment. This includes new in-store boutiques from
some of today’s hottest designers.
Our stores continue to emphasize increased inventory
velocity by editing out duplication and reducing the clutter
on the selling floor. Customers want us to be in stock, but
they don’t want to be overwhelmed by the amount of
choice, particularly in basic merchandise.
By reducing duplication in basic and promotional items,
we are able to invest inventory dollars in best-selling items
and newness, which makes our selling floors fresher and
more enticing to the customer.
2006 Sales by Merchandise Categories
Men’s &
Children’s
22%
35%
Home/
Miscellaneous
Feminine Accessories,
Intimate Apparel,
Shoes & Cosmetics
15%
28%
Feminine Apparel
Footnote: Sales include leased businesses such as Fine Jewelry.
Simplified Pricing
Demonstrates Value
If Macy’s is to succeed as a fashion retailer known for
affordable luxury, our customer must understand the value
we deliver. So the company is working to make its pricing
clearer, more credible and simpler.
We want our customer to immediately recognize –
and get excited about – the great value she’s getting in
our stores.
Our first price simplification initiative is to reduce our
level of public couponing. Coupons will not disappear
from Macy’s, but we are issuing fewer of them.
Moreover, a greater proportion of Macy’s coupons are
being delivered one-on-one to our customers who have
a Macy’s credit card – to bring them into the store more
often and capture a larger share of their spending.
Over the last five years, while reducing the number of
coupons, Macy’s has increased the proportion of coupons
offered only to our credit card customers.
Everyday Value
Another way we’re delivering exceptional value is Macy’s
everyday low pricing program, called Everyday Value. It was
launched two years ago and has developed to encompass
an expanding portion of the assortment in areas such as
ready-to-wear, kids and soft home.
Selected items from our private brands, as well as market
brands, are included in the program. With Everyday Value,
our customers don’t need to have a coupon or wait for
merchandise to go on sale.
Enhanced Stores Improve the
Shopping Experience
We’re continuing to improve the standards and features of
Macy’s and Bloomingdale’s stores, and our customers are
responding enthusiastically.
Every day through mailed surveys and an online system
for collecting comments, we ask customers to rate our
performance. They grade us on their overall shopping
experience, if our stores are clean, neat and easy to shop,
and if our associates are courteous and respectful. In 2006,
we heard from more than 600,000 customers and our
scores once again improved, as they have in each of the
past five years.
While a majority of all customer comments we receive
are compliments, our progress in satisfying customers
reflects our determination to listen to their concerns and
act accordingly to improve our stores.
Over the past few years, in response to customer
comments, we enhanced sales associate presence on the
selling floor; expanded the use of technology, such as
portable register carts and line-busting programs to reduce
lines during busy periods; and took action to make our
selling floors less crowded and less cluttered.
Marketing Tells the Story
Bold and interesting marketing campaigns are
communicating to customers the differentiation in our
assortments, the value inherent in our pricing and the
excitement in our stores.
Our print and broadcast ads, mailers, signage, shopping
bags, visual merchandising, in-store events, community
involvement and public relations – all integrated and
working together – educate our customer and set the tone.
At Bloomingdale’s, the marketing is sophisticated and
upscale, reflecting the store’s appeal to fashion-driven
customers who are keenly interested in what’s hot and
what’s new from the best known designers in apparel,
accessories, cosmetics, fragrances and the home.
Continued Investment in Reinvent
Federated continues to invest in “reinventing” Macy’s and
Bloomingdale’s stores, including former May Company
locations that were converted to our Macy’s or
Bloomingdale’s nameplates in 2006.
Reinvent elements include redesigned vestibules for
our fitting rooms, which provide customers and their
companions more spacious and comfortable environments.
In all, we have installed more than 2,400 fitting room
complexes over the past four years. By 2009, we expect to
reinvent stores representing 70 percent of total sales volume.
More than 16,000 price scanners have been added to our
stores, allowing customers to understand the price even
before they buy. Wayfinding signs are guiding shoppers
through hundreds of Macy’s stores, while shopping buggies
are helping customers navigate home merchandise
departments and making shopping easier.
Bloomingdale’s is upgrading amenities that are important
to customers, such as fitting rooms, restrooms, lighting and
special areas for sitting and relaxing.
Macy’s Marketing Works Magic
Macy’s spring 2007 national television campaign, “Hope
Springs Eternal,” celebrated the season and focused for the
first time on individual product categories. Four separate
ads – all shot in the lush countryside – feature dresses, shoes
and intimate apparel, including Macy’s private brands.
“This campaign moves the Macy’s brand forward by
showcasing our fashion and styles and celebrating Macy’s as
a fashion destination through the quality of our assortment,”
said Anne MacDonald, president and chief marketing officer
of Macy’s Corporate Marketing.
The Intimate Apparel spot featured Macy’s new “Fit
Matters” initiative, where fit coordinators provide in-depth
product knowledge to sales associates and individualized
service to customers. The shoes and dresses ads focused
on the beauty, quality and breadth of Macy’s assortments
in a light-hearted way.
The sophisticated campaign included print and in-store
visuals as well. April issues of Vogue, InStyle, Glamour and
Lucky included a 16-page Macy’s insert with a red Gerber
daisy on the cover. Inside, customers saw the latest in readyto-wear and center core merchandise from great brands
such as Nine West, Jones New York, Guess, Lucky Brand,
Calvin Klein and I.N.C, among others.
In Macy’s stores, giant red Gerber daisies bloomed on signs
along with black-and-white graphic images. Whether in
print, in-store or television, advertising came together in
spring 2007 to capture the spirit of Macy’s in a magical way.
2006 Highlights and Recent Developments
2006 Highlights
2006 Highlights
Federated Approves 2-for-1 Stock Split
In May 2006, Federated’s Board of Directors approved a two-for-one split of the company’s common
stock after shareholders approved an increase in the number of shares from 500 million to 1 billion.
The stock split became effective through a stock dividend entitling shareholders to one additional
share of common stock for every share they owned. Shares were distributed in early June to shareholders
of record as of May 26. Trading began on a split-adjusted basis in mid-June.
It was the first split for Federated since 1992 when it was listed on the New York Stock Exchange in its
current form.
With the stock split, Federated’s Board of Directors declared a 2 percent increase in the quarterly cash
dividend (12.75 cents) that was payable July 3, 2006, to Federated shareholders of record at the close of
business on June 16, 2006.
Federated Completes Credit Card Portfolio Sales to Citi
In July 2006, Federated completed the final in a series of transactions related to its sale of Federated
and May Company credit card receivables to Citi. The receivables were sold to Citi at a premium of
approximately 11.5 percent.
The combined transactions produced pre-tax cash proceeds of approximately $5.6 billion in
2005 and 2006.
Federated’s Financial, Administrative and Credit Services (FACS) Group division continues to
manage key customer service functions.
Federated Launches
National Campaign
In September 2006, Federated unveiled the largest
nationwide advertising and marketing campaign in its
history, and more than 400 stores were converted to
the Macy’s nameplate. The campaign, designed as an
opportunity to re-launch the Macy’s name, introduced
Macy’s to new shoppers with a message about fashion
and affordable luxury. The launch represented the first
time that Macy’s has had a national presence.
The national campaign supported all Macy’s divisions
and included television, print, radio, mail, Internet and
in-store advertising, as well as special events.
“Expanding Macy’s presence nationwide presented a
once-in-a-lifetime opportunity to introduce our brand to
new shoppers with a compelling message about fashion
and affordable luxury,” said Anne MacDonald, president
and chief marketing officer of Macy’s Corporate Marketing.
“Consumers were able to see Macy’s as a fashion leader on
the national stage, yet accessible locally.”
(Please see page 12 for more details about the launch.)
Federated Sells Lord & Taylor
and Bridal Group
In October 2006, Federated completed the previously
announced sale of its New York-based Lord & Taylor division
to NRDC Equity Partners of Purchase, NY, for approximately
$1.047 million in cash and a long-term note receivable of
approximately $17 million. The Lord & Taylor division
included 48 stores in New Jersey, New York, Illinois,
Massachusetts, Connecticut, Maryland, Virginia, Michigan,
Pennsylvania, and the District of Columbia, as well as a
distribution center in Wilkes-Barre, PA.
In January 2007, Federated completed the sale of David’s
Bridal and the upscale bridal brand Priscilla of Boston to a
Los Angeles company for approximately $740 million in
cash. The previously announced sale included 273 David’s
stores and 10 Priscilla locations.
Macy’s will continue to be the exclusive department store
wedding gift registry partner for David’s Bridal.
Federated sold its 507-store After Hours Formalwear
business to Houston-based Men’s Wearhouse in April 2007.
That sale completed the divestiture of the company’s former
Bridal Group division. Federated acquired the Bridal Group
chains with its $17 billion acquisition of St. Louis-based May
Company in 2005.
2006 Highlights
Martha Stewart Collection:
Exclusively at Macy’s
An agreement was announced in April 2006 for a new
“Martha Stewart Collection” brand to be developed
exclusively for Macy’s. The all-new line will launch in fall 2007
in Macy’s stores across America, as well as on macys.com.
The Martha Stewart Collection will encompass a broad
range of home goods – including textiles,
housewares, casual dinnerware, flatware
and glassware, cookware, holiday
decorating and trim-a-tree items –
developed especially for the upscale
Macy’s customer. Macy’s also expects
to sell other Martha Stewart-branded
products, potentially including home
furnishings, holiday celebration
concepts, bridal registry items and
“how-to” books and cookbooks, as
well as merchandise in categories new to Macy’s, such as
holiday-specific food preparation.
Merchandise is being created by the Martha Stewart
Living Omnimedia design team under Martha Stewart’s
direction. Macy’s is responsible for manufacturing and
distribution, as well as marketing to consumers.
“Martha Stewart is widely recognized across America as
the genuine authority on home decorating and graceful
entertaining,” said Janet E. Grove, chairman of Macy’s
Merchandising Group and Federated vice chair. “Our
research shows that Macy's customers respect Martha
Stewart’s creativity and taste, and they turn to her for
products that express a traditional and updated casual style.”
Wedding & Gift Registry
Macy’s Wedding & Gift Registry and The Registry @
Bloomingdale’s both added exciting new elements to their
programs in 2006, including updated in-store and online
registry environments, entertaining events, elegant
merchandise assortments and enhanced registry rewards
programs. Both registries offer convenience and service
to bridal couples and their guests through a national
network of stores, online tools and information through
weddingchannel.com, and personal service by phone.
Macy’s has one of the largest wedding registry
businesses in the country, and it grows each year. In
spring 2007, 10 special events with celebrity wedding
planner David Tutera brought thousands of new couples
to Macy’s, many who began their registries on the spot.
Similarly, Bloomingdale’s intimate Registry 101 breakfast
events included comprehensive tours, product education
and one-on-one service.
New at Macy’s in 2006 were Internet registry lounges,
piloted in 15 stores. This enhanced bridal environment,
with macys.weddingchannel.com access, includes an
edited product assortment merchandised by lifestyle and
interactive “try-it” stations where couples can mix and
match products right in the registry area.
In April 2007, Macy’s announced a new partnership with
theknot.com, considered one of the most comprehensive
resources for couples in planning their weddings and future
lives together. Macy’s and The Knot developed a fun way to
begin online registries, in addition to many other features.
This Ultimate Lifestyle Registry includes a witty quiz to help
couples define their style and suggests a list of products to
suit their life together.
Bloomingdale’s is re-launching its WeddingChannel
site in May 2007 with new features and a look “like no other
store in the world.” A sophisticated marketing campaign
will include “The New Rules of the Registry,” a hip way to
communicate with brides, beautiful in-store visuals and
fun print advertising.
A majority of bridal couples begin the registry process
in Macy’s and Bloomingdale’s stores, but a growing
number choose to start their registries online each year.
Guests also are looking to the Internet more and more
to purchase gifts. On macys.weddingchannel.com or
bloomingdales.weddingchannel.com, couples can easily
register, update gift preferences, and plan their wedding
online. Free tools include registry checklists, guest list
manager, rapid registry technology and a free wedding
Web site.
Benefits offered by The Registry @ Bloomingdale’s and
Macy’s Wedding & Gift Registry include the industry’s most
valuable rewards programs. Couples earn rewards on their
Macy’s card purchases and on the purchases guests make
from their registries. Both Macy’s and Bloomingdale’s
couples enjoy special gifts with registry and completion
programs and also receive 10 percent off most gifts
remaining on their registry after the wedding date.
Recent Developments
Recent Developments
Federated Increases Company’s
Stock Buyback Program
Federated Plans
Corporate Name Change
In February 2007, Federated’s Board of Directors
authorized a $4 billion increase in the company’s stock
buyback program. At its share price in February, the buyback
represented about 18 percent of Federated’s common
shares outstanding at the end of fiscal 2006.
In a move to reflect its position as a national retail brand,
Federated’s Board of Directors will ask shareholders to
change the company’s name to Macy’s, Inc. at its annual
meeting in May. If approved, the new company name will
take effect June 1 and Macy’s, Inc. will trade under the
symbol “M” on the New York Stock Exchange.
“The Board’s decision reinforces its confidence in the
future of our company as we continue to implement
strategies for building Macy’s and Bloomingdale’s as
nationwide brands,” said Federated Chairman, President
and CEO Terry J. Lundgren. “We believe that repurchasing
shares is a very productive use of excess cash and balance
sheet capacity.”
Federated used a portion of this authorization to effect
the immediate repurchase of 45 million outstanding shares
for an initial payment of approximately $2 billion through
accelerated share repurchase agreements. The remaining
authorization can be used by the company to repurchase
shares from time to time in the open market or in other
negotiated transactions.
In fiscal 2006, the company used approximately
$2.5 billion of excess cash to repurchase approximately
62 million shares of Federated common stock.
With the additional authorization to the share repurchase
program and the immediate repurchase agreements
entered into by the Company, the repurchase program had
approximately $2.170 billion of authorization remaining
as of Feb. 27, 2007.
According to Terry J. Lundgren, Federated’s chairman,
president and CEO, the new name is more appropriate
for a company that has about 90 percent of its sales under
one brand.
“Macy’s is a name that more accurately reflects the
transformation of our business in recent years,” said
Lundgren. “By aligning our corporate name with our
largest brand, we will increase the visibility of the company
with customers, leverage the world-famous Macy’s brand
name, and get more credit for our accomplishments in
the marketplace.”
Federated Department Stores, Inc. was originally chosen
as the company name in 1929 by a group of family-owned
department stores that joined together under a corporate
holding-company umbrella. Federated became an operating
company in 1945 with various regional department
store names.
In 2005 and 2006, all regional nameplates (except
Bloomingdale’s) were converted to Macy’s. Today, the
company operates more than 800 Macy’s stores in 45 states,
the District of Columbia, Guam and Puerto Rico and will
operate 40 Bloomingdale’s stores in 12 states when two
new stores open this year.
“Bloomingdale’s is – and will remain – a very important
part of the company,” said Lundgren. “A new name will in
no way limit or constrict us from growing in any direction
in the future.”
Macy’s
Macy’s is capturing the spirit of America as it pursues an exciting
new course for the future. Federated has launched Macy’s as a truly
nationwide department store. By reflecting uniquely American
lifestyles … by providing fashion and delivering affordable luxury …
by putting the customer first, Macy’s is distinguishing itself as
something very special on the American landscape.
Federated is driving significant progress in each of the four strategic
priorities that guide business decisions related to Macy’s. The four
priorities – Assortments, Price Simplification, Improving the Shopping
Experience and Marketing – have helped sharpen our discipline and
creativity, while providing Macy’s a well-defined roadmap for continuous
improvement in the most crucial aspects of daily operations.
Focusing on Core Customers
To drive sales growth and deliver comp store increases at Macy’s, our mindset has shifted
from a broad customer target to focusing on winning greater loyalty from style-oriented
men and women who can afford what they want and who care about quality for themselves,
their families and their homes.
Macy’s core customer is clearly defined, based on extensive research into the shopping
habits and buying preferences of consumers nationwide. Macy’s core customers fall into
four key lifestyles, which encompass both women and men:
Traditional customers are family-centric, insistent on quality, and demand consistency in
their brands. They relate to a conservative view of things, from their homes and cars to the
pets they own and the vacations they take. Traditional customers are neat and confident
and put the most effort into traditional occasions.
Neo-traditional customers are very busy people. For them, classic has great credentials,
but has to embrace newness, trends, self-expression and, especially, convenience. They
still are very classic, but will go for trends in a safe, secure form. Family is important, but
these customers want more convenience and comfort in their lives.
Contemporary customers are independent thinkers with a modern attitude. They
gravitate to clean, simple, sophisticated design, ideas and brands. Individuality is key,
and a contemporary viewpoint is reflected in how they look. Contemporary customers
are fashion-conscious and technology-oriented, owning every gadget available. Their
careers are consuming, so they unwind through sports and spas. Their homes are
minimalist, showing a preference for clean, affordable design.
Fashion customers are trendsetters who are always up on what’s hip, hot and next.
Brand fickle, they’ll redefine their style at the drop of a hat. Fashion customers are truly
dedicated followers of fashion. They tend to be less brand loyal, instead pursuing the
latest, newest thing – whatever that might be and wherever that might take them.
Private Brands
Macy’s is recognized as a retail industry leader in developing private brand merchandise that
differentiates the assortments in our stores and delivers exceptional value to the customer. In
addition, selected Macy’s private brand merchandise is sold through non-competitive department
stores internationally.
Merchandise for each private brand, available “Only @ Macy’s,” is developed to appeal to a certain customer lifestyle and
supported with marketing programs that create a precisely defined image.
For women, Alfani offers interchangeable separates and
seasonless suits with a clean, modern sensibility and a refined fit.
The collection features updated suiting and more relaxed “city”
separates. Alfani for women includes sportswear, intimate
apparel, jewelry, handbags and accessories.
Alfani offers men updated classics – clothing for the man
who wants to look appropriate but up-to-date. Designed with
an emphasis on fabric and detail, the collection brings newness
to the wardrobe in a comfortable way. Alfani for men includes
sportswear, clothing, pants, furnishings, shoes and accessories.
This brand aimed at the teen market consists of casual clothes
with a strong denim base. Designed to offer clothing that is
fresh, approachable and unique in spirit, American Rag appeals
to young men and women who want a look that’s original,
authentic and relaxed.
Charter Club offers all-American style in a traditional and
timeless collection of separates – for career, weekend wear and
active leisure activities. It is designed for the woman who
appreciates a clean, put-together look with the right balance of
classic style and comfort. The brand includes sportswear,
intimate apparel, jewelry, accessories, bedding and bath.
Club Room features men’s classics for weekend or business
casual occasions and tailored suiting for the career-oriented
professional. Business casual clothing offers a more relaxed
version of classic business wear. Weekend casual includes
traditional sportswear. The brand includes sportswear, clothing,
furnishings, pants, shoes and accessories.
First Impressions classic clothing for newborns and infants is
defined by fine fabrics and time-honored details. The collection’s
soft fabrications and sweet, traditional designs make First
Impressions a favorite gift choice. The brand includes clothing
and matching accessories for boys and girls with an emphasis on
special occasion dressing.
A comprehensive brand of children’s play and school clothes,
greendog has an easygoing, natural style, a relaxed fit and an
appealing price. Kids love the smart, fresh design and parents
appreciate the great value and easy care. The brand includes
mix-and-match pieces for school, casual or sport for infants,
boys sizes 2 – 20 and girls sizes 2 – 16.
This luxury collection for the home evokes the cool, clean-lined
style of a world-class hotel or spa, creating “an oasis in the
modern world.” Hotel offers high thread-count sheets and
luxury fibers for the customer who appreciates quality and
modern design. The sophisticated collection includes bedding,
bath and mattresses.
Macy’s
I•N•C for women delivers up-to-the-minute, trend-right
sportswear designed to add freshness and fun to the fashionable
woman’s wardrobe. Cutting edge, off-the-runway trends are
captured and delivered in high profile, affordable clothes for the
sophisticated woman who wants to be noticed.
For men, I•N•C offers a cleanly designed, forward-looking
clothing collection. Cool, understated suit separates, knits and
T-shirts are designed to mix and match for maximum versatility
for the contemporary man.
This brand is an up-to-date take on timeless menswear
traditions. Combining a modern look and styling with luxury
fabrics, expert tailoring and subtle details, the brand reflects the
influence of London’s legendary tailors and fashion designers.
Material London includes sportswear, suiting and furnishings.
Designed for the busy woman with a breezy, forward sense of
style, this brand offers a versatile collection of fashionable
sportswear and stylish accessories that transition from home to
work to weekend. The new Style & Co. Home bedding and bath
products offer the same clean lines, great style and mix-andmatch ease she loves. The brand includes sportswear, shoes,
accessories, and bedding and bath.
Elegant and refined, this brand of European-inspired menswear
is characterized by luxury fabrics and attention to detail. It is
designed for the more traditional customer who expects the
best in investment dressing. The brand includes sportswear,
clothing, furnishings, shoes and accessories.
Inspired by the latest trends in casual home entertaining,
The Cellar offers innovative design in a combination of core
basics and seasonal collections for both indoor and outdoor
entertaining. The Cellar includes decorative housewares,
tableware, serveware and glassware.
With more than 20 years of success to its name, this cookware
brand is a trusted name in countless American households.
Designed to provide high performance at a reasonable price,
Tools of the Trade offers quality, reliability and style in cookware,
bakeware, cutlery and kitchen gadgets.
Spectacular Events
Set Macy’s Apart
Macy’s strives to make the shopping experience
fun. There’s always something going on in our
stores – fashion events, product demonstrations,
personal appearances, sales, cooking events,
book signings or samplings. Shopping isn’t just
about finding products that meet a need – it’s
about entertainment.
That sense of adventure and excitement extends
into the community. More than ever before,
Macy’s distinguishes itself by hosting major
events that delight tens of millions of shoppers
in the places we do business.
Macy’s Thanksgiving Day Parade
Nothing says Macy’s better than the annual Macy’s
Thanksgiving Day Parade, which celebrated its 80th
anniversary in 2006.
Each year, thousands of Macy’s employees join celebrities,
volunteers, marching bands, clowns, balloons, floats and
performers to put on one of the biggest shows in America.
An estimated 2.5 million spectators line the streets of New
York City, with another 50 million viewers watching via
network television.
The Macy’s Parade has marched on since its inception
in 1924, with a brief hiatus during World War II. It was a
tradition begun by Macy’s employees, many of whom had
recently arrived in the U.S. and wanted to give thanks for
their newfound freedoms.
Since then, the Parade has
entertained generations
of children and adults,
becoming as synonymous
with Thanksgiving as
a turkey dinner.
“2006 was a momentous
year in our history,” said
Robin Hall, executive
producer of Macy’s
Thanksgiving Day Parade.
“For 80 glorious years, we’ve been flying
high, lifting spirits, exciting children and fulfilling the
promise of ‘The Miracle on 34th Street.’ In 2006, six
spectacular new floats and three new giant balloons
plus scores of celebrities accompanied 10,000 spirited
marchers, including nine remarkable bands, to make
it a Parade to remember.”
Macy’s
New in 2006, in celebration of Macy’s National Launch
and the Parade’s 80th Anniversary, the Macy’s Parade-onParade® caravan was created to introduce 23 cities in 19
states to a quintessential New York experience, bringing
the Parade to life through interactive family entertainment.
From the first test drive in Detroit in September, to its
last stop at the balloon inflation the night before the Parade
in New York City, the free Parade road show generated
excitement at every turn. Two 18-wheelers unfolded to
reveal balloon flight training, a multi-media exhibit of
Parade history, a 25-foot Grover cold-air balloon, a photo-op
spot in a simulated NBC broadcast booth, as well as a stage
for a live musical revue.
Macy’s Annual 4th of July Fireworks
The annual Macy’s 4th of July Fireworks marked its 30th
anniversary in 2006 as America’s largest and most widely
seen celebration of independence. Each year, it dazzles some
3 million spectators in New York City, as well as a national
television audience.
The 2006 event, themed “It’s All About U.S.,” featured
120,000 blasts of pyrotechnic color, a live soundtrack from
the New York Pops, plus a patriotic flyover courtesy of the
U.S. Air Force. The vibrant fireworks burst 1,000 feet up in
the air from three different launching sites: along the East
River, at the Statue of Liberty, and the South Street Seaport.
The Macy’s Fireworks are not just grand in scale. They also
are grand in pyrotechnic innovations. An artistic approach
guides the design of the show in order to balance the proper
expression of American patriotism, with its traditional red,
white and blue hues, with a full rainbow of color.
Flower Shows Bring Eternal Spring,
Bloom in New Cities
The spectacular Macy’s Flower Shows at Herald Square in
New York City and Union Square in San Francisco herald an
early spring for 650,000 attendees each year. In 2007, shows
bloomed in Chicago and Minneapolis as well, bringing light
and warmth to the Midwest. Through these inimitable
displays, more than 2 million flowers and exotic topiaries from
all over the world are arranged by renowned horticulturalists
to create urban sanctuaries for flowers and visitors alike.
Macy’s Union Square visitors experienced “La Dolce Vita”
as the 60th anniversary event unfolded in April 2006, showcasing Italian culture amid lush greens and thousands of
blooms, including the famed Gomes Snowbird azaleas, a
part of Macy’s Flower Show since 1946. The 2007 extravaganza,
“Imagine India,” led guests through the vibrant colors,
distinctive style, delicious food and amazing flowers of India,
celebrating the gardens, art, architecture, and history of
Indian culture.
On both coasts, events for the entire family are scheduled
throughout the two-week shows, including seminars by top
florists, striking window displays, artisans and chefs, celebrity
appearances, Bouquets of the Day, informal modeling, and
entertainment amid a setting of millions of blooms.
In 2007, Macy’s on State Street revived a Chicago tradition
as it presented Gadina Africana, an exotic African flower
garden and celebration of the art, music and life of Africa.
The African theme was inspired by Macy’s “Path to Peace”
basket program benefitting women genocide survivors in
Rwanda. Gadina Africana also bloomed in the downtown
Minneapolis store. Both cities’ events featured two
photography exhibits and cooking demonstrations by
Macy’s Culinary Council member and acclaimed Ethiopianborn chef Marcus Samuelsson.
A floral collection of global proportions has taken root at
Macy’s Herald Square in New York for 33 years. In 2006, the
World’s Largest Store created “It’s All the Buzz,” featuring a
7-foot-tall Beehive Topiary complete with a giant flying bee
as the centerpiece. The spring 2007 spectacular, “Flora
Exotica,” created a fragrant floral fantasy including gigantic
giraffe topiaries and Jardinière, African and black-and-white
gardens. Animal lovers enjoy two special preview events,
Barkfast, a light breakfast with pets and their owners on the
store’s first floor, and Macy’s Petacular Fair with the Pet
Bonnet and Costume Competition.
Macy’s
Culinary Council Brings
Expertise to the Table
In 2006, Macy’s launched nationwide its Culinary Council,
a group of culinary masters representing Macy’s as the
destination for the ideas and products to prepare memorable
meals at home. The Culinary Council members, 15 widely
known chefs and culinary experts, are featured in Macy’s
signage, visual displays and books, all educating customers
about the latest cookware options to make food preparation
easy and enjoyable. Plus, the Council Web site, accessed
through macys.com, offers the latest recipes, tips and trends.
As part of Macy’s ongoing
support of the fight against breast
cancer, exclusive Frango® Pink Mint
Chocolates were developed to
help raise funds and awareness.
These limited edition chocolates,
sold in all Macy’s stores and on
macys.com, feature a design by
Miranda Moss, a Minneapolis artist
and breast cancer survivor. A
portion of the proceeds benefits
the Breast Cancer Research
Foundation.
In March 2007, “The Frango® Cookbook: Simple Recipes
and Sweet Ideas” made its debut in stores and online, with
36 recipes to include Frango chocolates in favorite
confections. Many of the recipes were created by Macy’s
Culinary Council Chef Elizabeth Brown.
Culinary Council members include renowned
restaurateurs, television personalities and experts in specific
areas of food and drink: Govind Armstrong, Rick Bayless,
Elizabeth Brown, Cat Cora, Tom Douglas, Todd English,
Tyler Florence, Gale Gand, Dave Lieberman, Andrea Immer
Robinson, Marcus Samuelsson, Tim Scott, Nancy Silverton,
Ming Tsai and Takashi Yagihashi. Through this creative
council, customers are inspired by what Macy’s brings
to the table.
Fashion’s Flair for the Dramatic
Savoring Sweet Frango® Mints
The now-famous Frango brand was created by the Frederick
and Nelson Company in 1918 as an ice cream-like
confection. It later turned into chocolate candies before the
name and recipe were sold to Marshall Field’s in Chicago
and The Bon Marché in Seattle. Today, the Frango legacy has
become a worldwide phenomenon with candies shipped
to six continents every year. The original flavor, mint, is the
signature Frango flavor. Frango chocolates became an
exclusive product in all Macy’s stores in September 2006,
and the Chicago stores also began serving and selling a new
Frango cheesecake made by Eli’s.
Just as Macy’s reaches specific customer groups through
fashion and home products that reflect their lifestyles, the
divisions present fashion and community events around
the country that speak to the unique brands and types
of merchandise in which customers are interested. These
ongoing special events educate – but also entertain – as
they present the latest color and accessory trends, styles of
entertaining and new products to simplify customers’ lives.
Every event focuses on what’s new and what’s exciting,
including demonstrations of the latest cooking techniques,
samplings with celebrity chefs from national television
shows and guest chefs from the hottest local restaurants,
in-store fashion shows with major designers, informal
modeling, live music and DJs, fragrance launches and
guest makeup artist events, bridal fairs and party-planning
seminars, and celebrity personal appearances and fashion
magazine events.
In preparation for the spectacular event, the company’s
buyers traveled to Western Europe last fall, scouring flea
markets in France, Spain, Portugal, England and The
Netherlands. The result will represent the best of Europe,
from old and rustic to new and sleek, a wonderful collection
of the classic and unusual. Throughout the Flea Market,
the assortment will be continually refreshed with new
merchandise such as a vintage jewelry and accessories
collection, a black-and-white collection and a vintage
barware collection.
Path to Peace Basket Project
Supports Rwanda
Federated’s growing supplier diversity initiatives hold great
promise, and one important example is Macy’s Rwandan
basket program. The company’s goals of differentiated
product, minority and women-owned vendor development
and giving back through economic partnerships led Macy’s
to the Path to Peace Basket Project, in partnership with four
Rwandan widows’ organizations. The women returned to a
traditional art form to resurrect the country in the aftermath
of genocide a decade ago. Income from the sale of one
handmade basket available at macys.com can support an
entire family for a month.
Holiday Traditions
Spark Seasonal Spirit
Chicago Flea Market Is a Find
For the sixth year in Chicago, and now in Minneapolis,
customers will be able to browse among authentic European
treasures at Macy’s. The one-month event was so successful
in 2006 that it will extend from May through July 2007 in the
Macy's on State Street store and expand to Minneapolis from
May through June.
Shining lights, stirring music and soaring evergreens all
bring the holidays to mind, and the special event magicians
at Macy’s used them to present gifts of the season to
customers nationwide. In addition to the spectacular Macy’s
Thanksgiving Day Parade in New York City, divisions coast
to coast present signature events that have signaled the
start of the holidays for decades.
Indoor and outdoor trees, up to 70 feet tall, are crowned
with crystal stars and lit with thousands of bulbs, bells are
rung, decorated windows debut, fireworks sparkle in the
skies and children welcome Santa in colorful parades.
Tens of thousands of people make these theatrical events –
and the accompanying store outings – highly anticipated
annual traditions.
Macy’s
Passport
Glamorama Rocks Fashion
The electrifying Macy’s West Passport extravaganza brings
fashion and compassion together. The latest trends in pop
culture, style and music blend to benefit a crucial issue –
finding a cure for HIV/AIDS. Passport has entertained West
Coast audiences for 24 years, and through 2006 has raised
more than $23 million
for HIV/AIDS research,
care, prevention and
education programs.
The famed Glamorama fashion event reigns supreme
each fall in Minneapolis and Chicago. The 2006 show,
“Glamosphere,” officially kicked off Macy’s fall fashion season
with the best designs and world-class entertainment. VIP
guest Beyoncé gave a high-energy show at the Chicago
Theater prior to a fashion show featuring her House of
Deréon clothing line. In their history, the annual standing
room-only, celebrity-packed charity shows have raised
about $7 million for The Art Institute of Chicago and the
Children’s Cancer Research Fund in Minneapolis.
The September 2006
Passport events in Los
Angeles, with special
guest Priscilla Presley and
actor John O’Hurley as
auctioneer, and in San
Francisco, with Sean “Diddy”
Combs on the runway and
actress Sharon Stone as
auctioneer, raised a total
of $1.5 million.
The party continued after the curtain dropped with
Passport In-Store, an exclusive shopping event in select
stores that has raised more than $2 million for HIV/AIDS
through non-profit ticket sales. Passport also included two
Teen Nights where 4,000 San Francisco and Los Angeles high
school students enjoyed the fashion theatre and HIV/AIDS
awareness activities presented by youth health educators.
Bloomingdale’s
Bloomingdale’s
Bloomingdale’s, America’s only nationwide, full-line, upscale department store, has
experienced outstanding performance and strategic progress. Bloomingdale’s was
among Federated’s best performing divisions in 2006 and continues to be recognized
for its originality, innovation and fashion leadership.
Bloomingdale’s continues to expand selectively and to fill in existing markets where it
already has established a presence and fashion leadership. The division will be growing again in 2007 with new stores planned for South Coast Plaza in Costa Mesa, CA,
and Chevy Chase, MD.
A Flagship Rises in San Francisco
In September 2006, Bloomingdale’s opened a spectacular
new West Coast flagship in Westfield San Francisco Centre at
Market and Fifth streets in the city’s flourishing downtown
area. The 338,550-square-foot store spans five levels,
including one that connects to a BART transit station.
An estimated 20,000 San Franciscans streamed through
the doors in 12 hours for a sneak-peek preview. At the official
opening, the line to get in the store was said to be an hour
and a half long. A gala cocktail reception celebrated the
new store and, through event proceeds, raised more than
$210,000 for clinical and research programs at the University
of California, San Francisco Children’s Hospital.
This new flagship is the second-largest Bloomingdale’s in
the country, following only the legendary Manhattan store
on Lexington Avenue at 59th Street. The store integrates
the existing San Francisco Centre with the adjacent former
Emporium department store building, which was destroyed
in the 1906 earthquake and rebuilt. The dramatic Emporium
dome, dating to that time, is considered a historic piece of
architecture and is the centerpiece of the project.
Bloomingdale’s has been honored with several distinguished awards for this breathtaking store, including the
Chain Store Age Retail Store of the Year.
Customers find excitement on each level, from The
Registry @ Bloomingdale’s on the Lower Level to “The Lab”
of men’s designer sportswear on the fourth floor. In between
are Bloomingdale’s signature black-and-white checkerboard
flooring in cosmetics, an array of boutiques with the
most coveted handbags and shoes of the season,
the store’s famed “At Your Service” and “At His Service”
personal shopping areas, The New View designer
sportswear department and Y.E.S. contemporary
sportswear with its vast premium denim selection.
Bloomingdale’s
New Stores Expand
National Presence
In addition to the San Francisco flagship, Bloomingdale’s
opened three other new or replacement stores in 2006 – in
Massachusetts, New Jersey and Southern California.
Bloomingdale’s fashion store in the Mall at Chestnut Hill
opened near Boston in November in a former May Company
location. This three-level, 189,000-square-foot store joined
the Bloomingdale’s men’s and home store, which anchors
another end of the mall. New in this store is the Young World
Department, returning to Bloomingdale’s after a long
absence and including interactive game stations for the
store’s youngest shoppers. The opening gala benefited the
Boston Symphony Orchestra and the local chapters of the
National Kidney Foundation.
Bloomingdale’s first store in San Diego opened in
November at Fashion Valley in a former May Company
location. This three-level, 219,000-square-foot store includes
cosmetics, accessories, fashion for men, women, children
and the home, as well as the “59th & Lex” restaurant. The
store captures the eclectic mix of San Diego and New York,
while adding distinctive Bloomingdale’s detailing. Opening
festivities benefited the Alzheimer’s Association, La Jolla
Playhouse and Voices for Children.
Bloomingdale’s opened a replacement home and
furniture store at The Shops at Riverside in Bergen County,
NJ, in September. This two-floor, 75,000-square-foot location
features a Godiva Chocolate shop with signature dipping
station, a stunning new demonstration kitchen and luxury
bedding by Michael Kors, whose first home collection
launched exclusively at Bloomingdale’s that month.
Holidays at Bloomingdale’s
Visitors come to Bloomingdale’s at the holidays to see the
famed merchandise for which the division is known, and
they also come to experience the events – the icing on the
cake of the season. Bloomingdale’s flagship 59th Street store
has a celebrated history of elaborately themed animated
windows and their unveiling, often featuring celebrity
guests and national entertainers, is the highlight of the
season for many families.
In November, Grammy-winning jazz trumpeter
Chris Botti celebrated the unveiling of Bloomingdale’s
59th Street holiday windows. Bloomingdale’s sold Botti’s
latest CD “December” with proceeds benefiting AmeriCares
international disaster relief and humanitarian efforts. In
scenes reminiscent of glittered snow globes, the windows
depicted benevolent characters of gift-giving from
throughout the world, from Father Frost in Russia to
Sinter Klaas in the Netherlands. Kwanzaa and Chanukah
were represented as family gatherings full of warmth
and tradition.
and meet designer Giorgio Armani backstage at his Milan
runway show, jet to England to be courtside at Wimbledon
in Ralph Lauren’s seats, or chose among other unique
experiences.
Bloomingdale’s Chairman Michael Gould presented
AmeriCares with a check for $268,100 in January 2007,
representing 100 percent of the proceeds from the World
Experiences auction with eBay and sales of Bloomingdale’s
Little Brown Bear. The donation’s impact will be substantial –
enabling AmeriCares to build five small hospitals or charter
three planes with 22 tons of medicine for Darfur.
During the Bloomingdale’s holiday marketing campaign,
customers had the opportunity to bid on once-in-a-lifetime
World Experiences through an online auction benefiting
AmeriCares disaster relief. Customers could fly to Italy
Bloomingdale’s
“Exclusively At
Bloomingdale’s” Events
Just as exclusive Bloomingdale’s merchandise earns the
“Exclusively At” designation, the same is true for scores of
special events that are produced each season throughout
the country. Bloomingdale’s is famous for its entertainment
partnerships – showcased in display windows, in-store
shops and appearances of the star performers.
Emmy-award winning
actress Mariska Hargitay
(“Law & Order: SVU”)
partnered with the
philosophy skincare
line and Bloomingdale’s
for a special event to
benefit survivors of
sexual assault. Hargitay,
founder of the Joyful
Heart Foundation, signed
bottles of philosophy’s
Joyful Heart Shower Gel
in the first philosophy
store-within-a-store
at Bloomingdale’s 59th
Street. The Joyful Heart Foundation is committed to the total
healing and recovery of survivors of sexual assault: mind,
body and spirit.
Where else but Bloomingdale’s would you find a
celebration of the 60th anniversary of the bikini? In
conjunction with Xtra Life LYCRA® and ELLE magazine,
this Bloomingdale’s event
included a fashion show
attended by more than
200 people and a personal
appearance by model Kelly
Killoren Bensimon. The
show featured the latest
designer swimwear as well
as archival bikinis from
the ’50s through the ’80s.
Customers who purchased
suits took home signed
copies of “The Bikini Book,”
a 400-page book of iconic
photos, created by Bensimon.
Supermodel Elle Macpherson made a personal
appearance in the new “Intimacies” department at 59th &
Lexington. She was in town to promote her fall 2006
intimate apparel collection themed “Once Upon a Time.”
In addition to scores of fans and customers, more than
30 photographers attended!
Intimacies: A Fresh Approach to
Intimate Apparel
Bloomingdale’s opened its reinvented “Intimacies”
department in the 59th Street location in June 2006. The
space is designed with boudoir furnishings, soft, cosmeticlike lighting and contemporary full-length mirrors. The fresh
environment includes a concierge to welcome and assist
customers, larger aisles, more mannequins showcasing the
season’s hottest looks and many new designers. Additional
fitting rooms have been created and revolutionized with the
latest call system technology. Inside the fitting room area, a
large armoire stocks the best selling styles by size so that
selling professionals can stay close to their customers.
Customers now enjoy the privacy of having a personal fit
specialist who can stay in touch via the new phone system
for quick dressing room attention.
Bloomingdale’s communicates
with its best credit card
customers with the exclusive
“Little Brown Book,” a bimonthly magazine featuring
fashion updates, stories on art,
culture and entertainment,
and offers available only to
“insiders.” “Little Brown Book”
has been recognized as a
publication that is visually,
editorially and strategically
outstanding, winning 11
Magnum Opus Awards in
July 2006, including a first
place Gold Award for best
use as an integrated
marketing tool.
Attracting and Developing Talent
To give our customers the best shopping experience possible, it is imperative that we
have the most skilled people in every position throughout the organization. Federated
is fortunate that its organization is considered to be one of the most talented teams in
retailing. We work hard at attracting, developing and retaining our talented workforce.
Recruiting The Best in Retailing
Recruiting begins with finding the right person to fill every job in our company and building a bench strength
of future leaders.
One of the key tools we use is online recruiting through www.macysJOBs.com and www.bloomingdalesJOBs.com.
These sites allow visitors to research a wealth of information about careers in all divisions at Federated, search
for individual positions by location, department or title, and apply online. In
2006, a record 5.5 million visitors reviewed these sites, which resulted in 69,000
new hires for the company.
Our college recruiting program is another important tool to ensure we
continue to have a team of the best talent in retailing. In 2006, we redirected
our efforts and began a combined recruiting approach with several divisions
simultaneously visiting key campuses, meeting faculty, and interviewing
students. The power of our unified “two brands-one company” approach is creating a buzz, and we are
establishing Bloomingdale’s and Macy’s as powerful presences on campus.
While our combined approach has only been in effect for a short time, we already have increased the
number of students interviewed and, subsequently, increased the number of graduates hired. Importantly,
we reached a key performance measure during the year – achieving double-digit hiring levels on several
targeted campuses.
In 2006, BusinessWeek ranked Federated as one of the “50 Best Places to Launch a Career.” This was the first year
the magazine published the ranking and was based on responses from college career advisors and students.
Learning and Development
Federated Leadership Institute
From senior management to merchants, store managers and
sales associates, a training program exists for every associate
at Federated. The company welcomes thousands of new
employees every year, so this commitment to development
shows the importance that Macy’s, Bloomingdale’s and
Federated place on everyone understanding the vision and
values that drive our business.
Federated is known for having very strong leadership
training; the company has been described as the “Harvard
of Retailing.” Federated has always been the organization
that other retailers benchmarked, the company that
invests in its people far more than others. Federated
believes that great leadership equals great performance,
and the company has an exceptional reputation for
providing meaningful training and giving people lots of
responsibility early in their careers.
“We invest in our company by developing our associates,
and that means continual training,” said David Clark,
Federated’s senior vice president for human resources.
“Training is not just a nice thing that we do. It’s a part of
the You Count value. We believe there is a return on our
investment in that our associates will feel more valued and
respected, feel more capable about doing their jobs and
will stay with the company.”
From the acclaimed Federated Leadership Institute for
senior executives to scores of courses taught in classrooms,
and via distance or computer-based learning, the education
available to our employees is diverse. Associates at all levels
complete a program that introduces them to the company,
the vision, the brand values, the core customer and the four
business priorities. Additionally, all new employees attend a
program that conveys the company’s position on diversity
and inclusion.
Experience has proven that well-educated, motivated
employees do better work and achieve success for themselves,
their teams and for the organization as a whole. In fact, across
Federated, we believe so firmly in “Growing People Who Grow
the Business”that we’ve trademarked the phrase.
For senior executives, the company has created the
Federated Leadership Institute (FLI) – an award-winning
“corporate university” – to strengthen leadership and
business management skills of the company’s top 2,000
senior executives. Introduced in 1999, FLI has been
highly successful in honing the skills of store managers,
divisional merchandise managers, support equivalents
and their managements.
Companies that are known for great leadership have
a combination of solid formal training programs, on-thejob experiences and managers who are committed to
taking the time and effort to developing people. At
Federated, our managers are responsible for the education
and growth of their teams. They are responsible for making
sure that all employees are given assignments that will
help them to develop.
“Lessons learned from FLI are invaluable,” said Terry
Lundgren, Federated’s chairman, president and CEO.
“Besides the strong partnerships that are developed,
participants are introduced to information that will help
them become better managers, which helps drive the
business. The best executives are those who can pick
good people, help them grow and allow them to
operate independently so that, collectively, we can
get the job done.”
2006 STAR Academy
Federated’s newest inductees into its STAR Academy reflect the company’s most successful selling
professionals in 2006.
Each year, the company’s top sales associates and sales managers are selected from each retail
division to join this prestigious group. Inductees are chosen based on their outstanding success in
sales, service, loyalty and leadership. They were honored at their division’s annual recognition event
where they received a $1,000 award, a plaque, a crystal star and a personal thank you letter from
Vice Chair Sue Kronick.
Sales Managers
Leaders in our stores possess strong coaching skills. They develop a partnership with their associates
that builds trust for a most successful team. Successful leaders know how to recognize ability in their
staff. They encourage and nourish those abilities by allowing associates to take on tasks that require
them to exercise those gifts. Good coaches enable learning and development to occur which helps
improve performance. They also live our brand values.
BLOOMINGDALE’S
MACY’S EAST
MACY’S FLORIDA
MACY’S MIDWEST
Cheryl Russo
Soho
Manhattan, NY
Diana Derti
Willowbrook
Wayne, NJ
Pedro Rossy
Dadeland
Miami, FL
Rosie McPartlin
Town Center Plaza
Leawood, KS
MACY’S NORTH
MACY’S NORTHWEST
MACY’S SOUTH
MACY’S WEST
Sally Conklin
Cherryvale Mall
Rockford, IL
Leeann Lingle
Tacoma Mall
Tacoma, WA
Bernadette Perez
The Shops at La Cantera
San Antonio, TX
Maria Liderston
Ala Moana
Honolulu (Oahu), HI
Sales Associates
At Federated, outstanding Customer Service is always our main priority to keep customers coming back. It’s more than
simply being polite to the customer. It means showing appreciation to every customer by putting her first. Thoughtfulness
counts. It goes beyond the golden rule. It means knowing who she is and what she wants. Every single time.
Mentoring helps promote Federated’s value of You Count. Effective mentoring not only empowers future leaders, but
also strengthens those already in leadership positions. A good mentor advises and shares experiences and organizational
knowledge to associates who benefit by analyzing their own experiences and perspectives. Associates consider their
own professional goals and develop strategies to meet those goals and sustain professional development.
A skilled salesperson knows the product he or she sells and understands the needs of the customer. Our store associates
know that our private brands are the drivers of our total sales. They know that our assortments appeal to the lifestyles of
our customers. They also know that our core customer falls into four key lifestyles that encompass both men and women:
traditional, neo-traditional, contemporary and fashion. Our STAR Academy honorees consistently deliver outstanding
service and build long-term relationships with their personal customers.
BLOOMINGDALE’S
MACY’S EAST
MACY’S FLORIDA
MACY’S MIDWEST
Elizabeth Araya
White Flint
Kensington, MD
Jehangir Irani
Springfield
Springfield, PA
Barbara Terrell
Tyrone
St. Petersburg, FL
Mark Satterfield
Kenwood Furniture Gallery
Cincinnati, OH
MACY’S NORTH
MACY’S NORTHWEST
MACY’S SOUTH
MACY’S WEST
Jacquelyn Cutright
Oakland Mall
Troy, MI
Rubicela Robles
Columbia Center
Kennewick, WA
Safia Fares
Vista Ridge Mall
Lewisville, TX
Yvonne Boyd
Solano Mall
Fairfield, CA
2006 Service Leadership Awards
General Managers named as STAR Service Leaders are honored for overall leadership in service:
surpassing Federated’s standard 80 rating on customer response letters, achieving sales plan
and attaining loyalty goals. In addition, winners exhibited exceptional leadership skills.
BLOOMINGDALE’S
MACY’S EAST
MACY’S FLORIDA
MACY’S MIDWEST
Rick Ranges
Roosevelt Field & Furniture Gallery
Garden City, NY
Ambar Gay
Plaza Las Americas
San Juan, Puerto Rico
Terry Kovach
Altamonte Springs
Orlando, FL
Bobbi Gassel
Town Center Plaza
Leawood, KS
MACY’S NORTH
MACY’S NORTHWEST
MACY’S SOUTH
MACY’S WEST
Lynn Otis
Empire Mall
Sioux Falls, SD
Shelley Louderback
South Hill Mall
Puyallup, WA
Marie Fisher
San Antonio, TX
Geoffrey Palmer
Victoria Gardens Mall
Rancho Cucamonga, CA
Service Leadership Division of the Year
Represents the best overall performance in comp sales, customer service and loyalty.
Macy’s West (second consecutive year)
The Macy’s West stores team had the highest number of stores that met the customer response letters standard of 80, which
is the best performance in total Federated. Rudy Borneo, vice chair and director of stores at Macy’s West, motivates his team
to embrace Macy’s brand values. Borneo’s personal passion for Customers First, You Count and Teams Win drives the results
achieved at Macy’s West.
Best Overall Customer Service Award
Represents the best overall shopping experience within Federated with the highest customer
response letter rating at 82.5.
Bloomingdale’s (second consecutive year)
Through the leadership of Bloomingdale’s CEO Michael Gould and Senior Executive Vice President and Director of Stores Tony
Spring, Bloomingdale’s continues to take the lead in customer service in the eyes of our customers.
Demonstrating Leadership
A Diverse and Inclusive Organization
Diversity is a business imperative for Federated.
Our inclusiveness and diversity set us apart
among other U.S. businesses in general and
among retailers in particular.
Our commitment to diversity touches all areas of our
business – from reflecting the wide range of customers
we serve in our advertising and in our stores to developing
the unique characteristics in every associate; from working
with a diverse set of vendors to ensure we have fresh and
distinctive merchandise in our stores to developing deep
connections in our communities through contributions,
sponsorships and volunteerism.
“We take diversity and inclusion very
seriously in making decisions that
help grow our business in the
multicultural society we serve,”
said Terry J. Lundgren, Federated’s
chairman, president and CEO.
Our Associates
Federated recognizes the value that different perspectives
bring to our business, and we benefit from the individual
strengths of each associate. Women represent more than
75 percent of our workforce at Bloomingdale’s, Macy’s,
the support divisions and corporate office, and more than
68 percent of management-level executives are women.
More than 50 percent of our workforce is comprised of
racial minorities.
We reinforce
diversity at every
stage of an
associate’s career.
It begins with
recruiting, where
we work to build
strong relationships
with key colleges
and universities as
well as the United Negro College Fund, the Hispanic
Scholarship Foundation and the Asian & Pacific Islander
American Scholarship Fund. After becoming a Federated
associate, the diversity message continues through annual
workshops, seminars and computer-based awareness
training. Our numerous Diversity Councils and Employee
Resource Groups provide a solid platform for ensuring we
create an inclusive and supportive work environment to
attract and retain top talent.
Our Suppliers
Having a supplier base that
reflects our customer base
strengthens customer loyalty
and builds relationships in
our communities. Doing
business with a wide spectrum
of suppliers brings distinctive
merchandise into our stores,
differentiates us from the
competition, and helps us
gain a deeper understanding
of our markets.
Federated’s Supplier Diversity
Program focuses on sourcing the products we sell and
the services we need to run our business from qualified
minority- and women-owned organizations. In 2006, these
purchases totaled $772 million. This year, we will work with
a minority-owned investment firm to manage the Federated
Foundation funds.
Beyond goods and services, our Supplier Diversity
Program helps us support the economic health of the cities
and towns where we live, work and operate our business.
Our Communities
Our commitment to diversity is also apparent in our
commitment to our communities nationwide. Just as we
believe our workforce and supplier ranks are stronger and
more connected because of their diversity, the same is
true for our community support. We strive to reflect our
neighborhoods in the look of our stores, the merchandise
we offer, and the events we sponsor.
Two programs we are proud to highlight are:
Federated’s Law Department Brings
“Street Law” to Inner-City Students
Federated’s Law Department has joined with the innovative
program, Street Law, to bring the legal profession to life
for inner-city high school students and show that the law
touches their lives daily in ways they may not recognize.
The program has the added benefit of exciting these
students about a career in the legal profession.
Teams from Federated’s regional law departments in
Cincinnati, St. Louis and San Francisco partnered with
teachers and volunteers at four high schools to develop
the curriculum. Following training, Federated’s legal
professionals serve as guest teachers in the schools, and
the semester-long program concludes with a one-day
conference at the local Federated office for students to see
first-hand the operation of a corporate law department.
Federated is the first company to sponsor Street Law
in Cincinnati and St. Louis.
“Our enthusiasm for Street Law is two-fold,” said Dennis J.
Broderick, Federated’s general counsel. “Our law team has
been extremely generous in giving its time and expertise to
this program, and to connect with students who might not
have direct exposure to an attorney, paralegal or other legal
administrators. Additionally, we have the responsibility to
help ensure that the legal profession is and continues to be
diverse. Street Law is a terrific way to introduce students with
diverse backgrounds to the many aspects of a career in law.”
The Law Department hopes to roll out the program to its
other regional offices in the future.
Saluting Dr. Martin Luther King Jr.
Federated’s Diversity Leadership
Macy’s South was a sponsor of the acclaimed exhibit “I Have
A Dream: The Morehouse College Martin Luther King Jr.
Collection,” which opened at the Atlanta History Center in
January 2007. The exhibit features a collection of King’s
handwritten, personal papers that record his journey from
student at Morehouse to world-renown civil rights leader.
• Essence magazine named Federated as one of the
25 Great Places to Work for African-American women.
The collection contains more than 600 items from a
10,000-piece collection acquired by the city of Atlanta
from Morehouse. Included in the exhibit are the landmark
speeches made by King during his lifelong campaign
for social justice – the Nobel Peace Prize acceptance speech,
the famous “I Have A Dream” speech, and the “I’ve Been to
the Mountaintop” speech which was delivered the night
before his assassination. The celebrated “Letters from
Birmingham Jail” are also featured in the exhibit.
“Macy’s South is proud to be a sponsor of this exhibit.
The papers are displayed with reverence and profoundly
convey an important part of our country’s history,” said
Drew Pickman, president of Macy’s South.
• For the sixth consecutive year,
LATINA Style magazine ranked
Federated among its 50 best
companies for Latinas to work
for in 2006. The evaluation was
based on criteria such as the
number of Latina executives,
mentoring programs and
educational opportunities.
• The National Association of
Female Executives (NAFE)
named Federated
among its Top 30 Companies for Executive
Women for the sixth year. The award recognizes
the representation of women overall in the
company, in senior management, on the Board
of Directors, and among top earners.
• Federated ranked 20th among the “DiversityInc Top 50
Companies for Diversity” in 2006.
• Federated was recognized as one of America’s Top
Organizations for Multicultural Business Opportunities.
The award recognizes companies for their commitment
to women-owned and minority-owned suppliers.
• Federated was an original sponsor and one of three
corporate sponsors of the third annual National Urban
League Women of Power luncheon at the organization’s
national conference.
• For the third year, Macy’s Legacy of Leadership Award
Luncheon was part of Spelman College’s annual Women
of Color conference.
• Federated partnered with the United Negro College Fund
and the Asian & Pacific Islander American Scholarship Fund
to provide a combined $150,000 in support.
• For the second consecutive year, Bloomingdale’s was a
sponsor of the Corporate Counsel Women of Color
conference in New York
City, and this year, hosted
attendees at an exclusive
shopping event.
Participants include women attorneys of color who serve
as general counsel, corporate counsel or in other law
positions for Fortune 1,000 companies.
• Federated was among the host city corporate sponsors
of the national conference of the National Society of
Hispanic MBAs in 2006.
• Federated scored very high on the Human
Rights Campaign Corporate Equity Index. The
company also includes gender identity in its
written nondiscrimination policy.
Helping Our Communities
Federated, its Foundations, employees and customers support thousands of
nonprofit organizations annually, enriching the communities where we do business
and where we live and work. We believe in “giving back” because it’s the right thing
to do, and we are proud of our heritage as a community leader for worthwhile
initiatives across the country.
Support for our communities comes through gifts
from the company, the Federated Department Stores
Foundation (as well as The May Department Stores
Foundation), and our employees. We’ve also made it
possible for our customers to join us in “giving back”
through our programs such as Thanks for Sharing,
Shop for a Cause, and Go Red, the American Heart
Association’s women’s heart health program.
Additionally, Federated encourages its employees
to be active volunteers through the company’s awardwinning Partners in Time program. Approximately
130,000 hours were volunteered through Partners in
Time in 2006, which is valued as a $2.4 million
contribution by the charities we benefit.
Through all of our efforts last year – company,
Foundations, employees and customers – more than
$74 million was raised for nonprofit organizations
across the nation.
Total Charitable Giving
Includes Foundations, Corporate and Divisions (in millions)
$36.0*
$33.5*
$17.6
$14.7
$14.9
2002
2003
2004
2005
2006
*Includes Federated and The May Department Stores Foundations.
Corporate and Foundation Giving
Collectively, the Federated Foundation, May Foundation,
the company and its divisions contributed more than
$36 million in fiscal 2006. Gifts were directed in large part
to our core giving areas of arts and culture, education,
HIV/AIDS awareness and research, minority issues and
women’s issues.
An additional $38 million was donated by our associates
and our customers last year during our United Way
campaigns and through the “give back” opportunities in
our stores such as charity shopping days, Shop For A Cause,
and Thanks For Sharing.
2006 Contributions Included:
• Support for the capital campaign of the University of
Miami/Sylvester Comprehensive Cancer Center to expand
the diagnostic imaging facilities in the university’s
gynecological/oncology center.
• Funding for the New York City Partnership Foundation, Inc.
(The Fund for Public Schools), program to train great
principals for New York City’s most challenging public
schools. It has provided training and mentoring for more
than half of the city’s 1,400 school principals, producing
a new generation of school leaders who are committed
to achieving the reform objectives championed by the
Mayor of New York.
• Gifts to the American Red Cross to help with disaster relief
in Nashville as the result of tornado damage in spring 2006.
• A gift to the New Jersey State Police Survivors of the
Triangle, which provides resources to assist in the
rebuilding of the lives of surviving families of law
enforcement officers killed in the line of duty.
• A grant to The Children’s Diabetes Foundation at Denver,
which funds many of the programs at the Barbara Davis
Center for Childhood Diabetes. The clinical team provides
care for over 5,000 patients including 3,400 children –
making it one of the largest diabetes centers in the world.
The Center provides comprehensive clinical care delivered by
a team of 15 doctors, 11 diabetes nurse educators, four
dieticians and two social workers, and has an on-site eye
clinic. Care extends after hours to unlimited phone/fax/email consulting between visits and a 24/7 physician advice
hot line.
• Support for the Urban League of Metropolitan St. Louis to
help empower African Americans and others throughout
the region to secure economic self-reliance and civil rights.
• Funding for the Ohio “Employment Stabilization
Program” to help the unemployed understand basic job
expectations and maintain a job that promotes a future of
self-dependence. The program was based on a growing
group of “helpers” who were from the surrounding
neighborhoods of Over The Rhine in Cincinnati who
worked in the food kitchen, learned to interact with others,
and worked to grow beyond the kitchen job. This fostered
pride and determination to improve and move on –
translating into the beginnings of change for a community
with welfare and poverty.
• A grant to the Fox Cities Sick Child Care Program, which is
part of Child Care Resource & Referral, Inc., a Wisconsinbased agency that provides childcare for single parents
when children become ill and the parent must be at work.
• Support for the California Pacific Medical Center
Foundation, which provides integrated health and healing
services for people with cancer, heart disease and HIV/AIDS
who are underserved by the medical community. The
Center’s service works to reduce pain, improve the ability
to handle stress and anxiety, and deal with the emotional,
physical and spiritual challenge of illness. Services are
provided by medical doctors and other practitioners
like acupuncturists, yoga therapists, nutritionists and
a chi kung master.
• A grant to the Shepherd Wellness Community, located
in western Pennsylvania, to help them provide dinners
to those infected and affected by HIV/AIDS. This Wellness
Community chapter serves more than 6,000 meals each
year to residents of the Pittsburgh metropolitan area and
11 surrounding counties. In addition, our grant helped
them form three support groups recently: a group for those
who are HIV-positive, a group for persons affected by HIV,
and a support group for HIV-positive heterosexuals.
Federated Foundation Matches More
Gifts from Generous Associates
Similar to our corporate philosophy, Federated’s associates
also believe in giving back to their communities. In 2006,
associates contributed more than $5 million of their personal
funds to approximately 4,700 charitable organizations across
the nation. These associate gifts were doubled by the
Federated Foundation, which matched associates’ gifts
dollar-for-dollar.
Our Matching Gift program was expanded in 2006 to
enable the Federated Foundation to match associates’ gifts
to most organizations holding a 501(c)(3) tax-exempt
certification from the Internal Revenue Service, and the
minimum donation matched was lowered to $25.
Scholarship Program Introduced
for Federated Associates
The Federated Foundation announced a new scholarship
program in 2006 that will award a total of 54 $1,000
scholarships per year to high school seniors who are children
of full- or part-time Federated employees – or who are
employees themselves.
The program is administered by the National Merit
Scholarship Corporation (NMSC), and the scholarships are
awarded for four years at $1,000 per year. Scholarships are
awarded based on academic records, test scores, leadership
and a record of significant extracurricular activities, as well as
recommendations from the applicant’s high school.
Following the NMSC’s application and review process, the
first scholarships will be awarded to the high school
graduating class of 2008.
OASIS Enriches The Lives of
Mature Adults
Federated is the national sponsor of OASIS, the nation’s
largest, most comprehensive educational and volunteer
service program for seniors. The spectrum of classes range
from the arts and humanities to wellness and nutrition for
the mature adult to technology for today.
The company currently provides meeting
space for OASIS chapters in 19 Macy’s stores
across the country and supports chapters
in five other locations. OASIS membership
nationwide totals more than 366,000.
In line with its mission of providing
lifelong learning and service opportunities
that inspire mature adults to pursue
productive lives, the OASIS Intergenerational Tutoring
program is one of the organization’s most successful
volunteering initiatives. In 2006, trained OASIS volunteers
provided one-on-one tutoring to more than 9,000 at-risk
children in 902 schools coast to coast.
OASIS recently received the Jack Ossofsky National
Leadership Award from the National Council on Aging.
The award is given to organizations that have taken a new
idea and developed it into a successful program that helps
older adults achieve vital aging.
Federated Is a United Way
National Corporate Leader
Federated, Macy’s and Bloomingdale’s have a generous
history of partnership with United Way (UW) and the
company is designated as a United Way of America “National
Corporate Leader.” In 2006, Federated contributed more than
$16.7 million to UW chapters across the country – about
$14 million from individual
employees and about
$2.7 million from the
Federated Foundation.
Among other National
Corporate Leadership companies, this level of support places
Federated in the top 25 overall.
Being named as a Corporate Leader recognizes Federated’s
wide-ranging support for the community, not just financial
commitment. Involvement starts with the leadership team –
many senior executives serve on UW boards throughout
the country – and Federated’s Partners in Time employee
volunteer projects benefit hundreds of UW social service
agencies nationwide. Macy’s Northwest received the 2006
United Way of King County Sustaining Supporter Award for
its dedicated level of giving over the past five years.
Holiday Program Gives $10.8 Million
to Charity Nationwide
Thanks for Sharing, Macy’s popular holiday gift rewards
program, will contribute approximately $10.8 million to
charity in 2007, a new record for the national campaign.
Thanks for Sharing has benefited communities nationwide
with $24.4 million in the last four years. The primary Thanks
for Sharing beneficiary is the American Heart Association’s
“Go Red for Women” movement to promote heart health,
with funds raised at every Macy’s division donating to that
cause as part of Macy’s national Go Red sponsorship. Other
beneficiaries include: America’s Second Harvest, Boys & Girls
Clubs, Susan G. Komen Breast
Cancer Foundation, Make a Wish
Foundation and United Way.
Thanks for Sharing debuted
as a national Macy’s initiative in
2003 – a distinctive effort from
which customers benefit during
the holiday season and charities
benefit throughout the year. Customers join the program
for $25. In return, they receive a Reward Card valued at
10 percent of all their Macy’s credit card net purchases made
during the holiday period. Plus, for each Thanks for Sharing
program member, Macy’s donates $10 to charity.
Lighting the Way for
Breast Cancer Research
Strong support of breast cancer research by Macy’s,
Bloomingdale’s and Federated has resulted in contributions
of more than $800,000 to research organizations in the past
year through events, promotions and grants.
In October 2006, First Lady Laura Bush was the special
guest at the Macy’ssponsored ceremony to
illuminate the Gateway
Arch in St. Louis with
pink lighting to
recognize Breast Cancer
Awareness month.
This was the third
consecutive year that
Macy’s has sponsored
the illumination.
Macy’s and Bloomingdale’s both collaborated with Estée
Lauder on exclusive campaigns to benefit breast cancer
research in fall 2006. More than $600,000 was raised for
The Breast Cancer Research Foundation (BCRF) through the
sale of exclusive and limited edition merchandise. Macy’s
“For the Love of Her Life” campaign merchandise included
plush animals and exclusive Frango® Pink Mint Chocolates.
Bloomingdale’s Big Pink
Umbrella was created as
the exclusive item for
2006. It debuted at the
Global Breast Cancer
Awareness Campaign kickoff
at the 59th Street flagship
store. Bloomingdale’s also
hosted a private dinner
with its Chairman Michael
Gould and dedicated a
Lexington Avenue window
to showcase Big Pink.
Macy’s Shop for a Cause Raises
$9 Million for Charities
As a part of Macy’s national brand launch, Macy’s hosted its
first national “Shop for a Cause” event to benefit thousands
of charities in local markets around the country. Shop for a
Cause raised more than $9 million in one day – September
16 – for participating charitable organizations.
“Macy’s Shop for a Cause was a tremendous success for our
charity partners around the country,” said Anne MacDonald,
president and chief marketing officer of Macy’s Corporate
Marketing. “Raising $9 million in one day is an extraordinary
accomplishment, and we are delighted with our customers’
enthusiastic participation in this program.”
Macy’s donated tickets to important local charities
around the country, including the American Heart
Association, as an extension of Macy’s national support of
the “Go Red for Women” movement. Charities sold the tickets
and retained the proceeds. Tickets also were sold at Macy’s
with proceeds divided among all participating charities.
Ticket holders received a coupon for 20 percent off men’s,
women’s, kid’s, and accessories merchandise and 10 percent
off home items.
Macy’s “Go Red” Improves
Women’s Heart Health
Macy’s is the national sponsor of the American Heart
Association (AHA) “Go Red for Women” movement to help
women live longer, stronger lives. To date, the AHA has
received more than $8.5 million for its heart disease
awareness and prevention campaign from the full scope
of Macy’s sponsorship initiatives.
Through Macy’s involvement, National Wear Red Day
(Feb. 2) raised more than $175,000 in one day for “Go Red
For Women,” as customers pledged to love their hearts
through lifestyle changes. Customers who wore red received
a 15 percent off savings pass, or could donate $2 to the AHA
in exchange for a “red dress” pin and the shopping pass.
Thousands of Macy’s and Federated employees went red in
their own fashion, too, including those who joined an AHA
“human red dress pin” under the Gateway Arch in St. Louis.
A special “Go Red” episode of The Learning Channel’s
popular “What Not to Wear” program aired in March 2007,
featuring a makeover of a heart disease survivor and
integrating Macy’s and the campaign throughout the
broadcast. The cast shopped the store and the “reveal”
was filmed at Macy’s Center City in Philadelphia.
Joy Behar (“The View”) and Lorraine Bracco (“The
Sopranos”) made a special appearance in Macy’s Herald
Square store in January 2007 to commemorate the launch of
American Heart Month and to encourage customers to take
the heart health checkup at www.goredforwomen.org.
In addition to fundraising activities, Macy’s divisions
nationwide planned special events to bring awareness
to “Wear Red Day,” including holding rallies with health
screenings for customers, sharing heart disease awareness
tips in televised fashion segments and holding heart-healthy
potlucks at associate health fairs.
“Back to Books” Raises $1 Million
for Literacy
Grants-for-Schools Program
Earning for Learning (EFL), Federated’s unique volunteer
grants initiative, gives associates an opportunity to
provide $250 grants to schools in which they give time for
educational programs. Earning for Learning was created
as a commitment to America’s Promise in 1998, and since
then, has given more than $900,000 to 1,000 schools
nationwide. About 62,000 hours of mentoring and tutoring
have enriched the schools most important to our associates
in 34 states.
EFL underscores Federated’s long-term commitment
to education by supporting tutoring, mentoring and other
educational activities, and giving grants through the
Federated Foundation to accredited public and private
elementary and secondary schools. EFL encourages
Federated employees, retirees, and their immediate family
members to get involved in their children’s schools, in
Partners in Time-paired schools, or in neighborhood schools.
All Macy’s divisions joined together in 2006 to create the
“Back to Books” campaign to raise funds for Reading Is
Fundamental (RIF), the nation’s oldest and largest children’s
and family literacy organization. Macy’s customers donated
more than $1 million to support RIF programs during the
July-to-September period – the largest customer-supported
donation in RIF’s 40-year history.
Donations will support local RIF programs, provide reading
resources nationwide, and also create a new Macy’s Fund for
Multicultural Resources to provide greater literacy resources
to African-American, Hispanic and Native-American children
and families in the U.S. Macy’s most successful RIF donation
stores throughout the country received a library of 100 highquality books and Story Sampler literacy activities to be
given in their store’s name to a local RIF school program.
Volunteerism
Over the years, we have worked to channel
the energy and resources given by our
employees nationwide to volunteer projects
in their communities. Federated believes that
community service is a cornerstone of the
company’s values, as well as a grassroots
representation of its overall philosophy.
Federated’s Partners in Time employee volunteer program
celebrated its 17th anniversary in 2006. It is an awardwinning program, which received the Points of Light
Foundation Award for Excellence in Workplace Volunteerism,
among many other honors. With its launch in Macy’s
Midwest and Macy’s North in September, Partners in Time
now has been adopted by all of the company’s divisions
across the country.
Over the years, 1.3 million hours have been given in
community service nationwide, valued at $22.4 million.
The simple, successful mission of Partners in Time, “Sharing
Our Time To Make A Difference,” has impacted nearly all
segments of society.
In 2006 alone, 67,000 employees, families and friends
volunteered more than 130,000 hours of time, valued at
$2.4 million to nonprofit organizations. Volunteers gave their
time to approximately 2,200 Partners in Time projects in 2006.
Partners in Time efforts made the most impact for youth
in 2006, with 33 percent of projects benefiting children and
school partnerships. Health issues, including AIDS, were
supported by about 14 percent of projects. With the
continuing success of Federated’s “Bag Hunger” food drive,
hunger relief represented 13 percent of volunteerism last
year. Efforts benefiting women’s issues such as breast cancer
research support and domestic violence prevention
represented 7 percent of volunteerism. Housing and
homelessness were impacted by 6 percent of Partners in
Time projects.
Volunteers “Bag Hunger” Nationwide
Volunteer of the Year
Daniel Walters of Macy’s West was the most recent winner of
Federated’s national Carol Reiser/Partners in Time National
Volunteer of the Year Award. Walters was selected for leading
a variety of Partners in Time projects, giving nearly 1,000
hours for 24 projects and keeping an entire team focused
on what they can do to Give Back. Walters reached out to
new charities such as the Project Angel Food AIDS services
organization and the Pasadena School District’s “Families
in Transition” program. Carol Reiser Award judges also
commended finalist Greg Pugh, regional visual director
at Macy’s Florida, for his outstanding service.
The Partners in Time national award, named in memory of
the program’s founder, Carol Reiser, is given to the Federated
associate who best exemplifies the Partners’ mission –
“sharing time to make a difference.” In addition to receiving
a Waterford crystal clock, Walters has named Project Angel
Food to receive a $1,000 donation that the Federated
Foundation is making in his name.
2006 Partners in Time Employee
Volunteer Service Hours by Issue Area
33% Children/school
partnerships
*Other
17%
13% Hunger
4%
Seniors 5%
HIV/AIDS
Arts, civic, culture
10% Health
5%
Housing/
homelessness
6%
7% Women’s Issues:
– domestic violence
– breast health
* Projects for the environment, holiday events, mentally and
physically challenged, diversity initiatives and others.
Federated’s ninth annual “Bag Hunger” national Partners
in Time project in June 2006 resulted in 6.6 million pounds
of food being donated by generous associates, nearly
50 percent more than the prior year. The
campaign kicked off on National Hunger
Awareness Day, June 6, and benefited
many affiliates of America’s Second
Harvest, the largest hunger-relief
charity in the United States. Divisions
throughout the country were very
creative in marketing their campaigns
such as Macy’s West serving breakfast to their
employees on Union Square in San Francisco and designing
the store’s windows.
Through “Bag Hunger,” Partners in Time addresses the issue
of child hunger, which is more acute in the summer when
children do not have access to school-based meals. Since the
project began in 1998, volunteers have collected food and
equivalent donations totalling 18.5 million pounds, providing
nearly 30 million meals for hungry families nationwide.
Divisional chief financial officers take on the additional
role of “chief food officers” for this effort, challenging their
respective divisions to surpass prior year contributions.
For 2006, Macy’s East, Macy’s West, Macy’s Home Store and
macys.com led the company, and the Federated Foundation
gave $10,000 in their names to their local hunger-relief
agency partners.
Give Back Day
In commemoration of the launch of the Macy’s name, and
the introduction of Partners in Time to Macy’s North and
Macy’s Midwest, the company’s employee volunteers
created the first “Give Back Day” national community
projects in September, many in conjunction with United
Way. In addition to the important service offered to diverse
children’s charities, a prime benefit was the opportunity for
2,300 volunteers from many different areas of the stores, and
also some support divisions, to work side by side, along with
Federated and Macy’s senior executives.
In New York City, Federated Chairman, President and
CEO Terry Lundgren joined volunteers from New Yorkbased Federated divisions to benefit the Henry Street
Settlement neighborhood services organization with 14
projects. In Atlanta and Houston, volunteers refurbished
two “Knowledge is Power Program” schools with extensive
building and landscaping projects, as well as creating a
mural for a hospital that was rebuilding after Katrina
damage. In Miami, volunteers planted a butterfly garden
and created play areas for two schools.
In Minneapolis, volunteers did a major renovation for the
Central Community Housing Trust, replacing furniture and
painting walls, among other efforts. In St. Louis, volunteers
benefited five public schools through educational field trips,
an athletic field day and hands-on projects. In San Francisco,
volunteers completely refurbished the Larkin Street Youth
Services Center installing new flooring, creating an edible
garden, and adding a “business clothes closet.”
In Seattle, volunteers did a complete fall “house cleaning”
for the Wintonia Community Housing Association. In Tampa,
volunteers benefited the Boys and Girls Club and in Portland,
OR, 200 employees walked in the Komen Race for the Cure.
In Cincinnati, volunteers from all local divisions of Federated
landscaped and performed service work for three United
Way children’s charities.
In New Jersey, Federated Logistics' Raritan Center and
Reverse Logistics volunteers did a complete makeover of the
Safe Haven Community Center in Perth Amboy, painting,
repairing and installing appliances for the after school
center. The Perth Amboy Mayor and Police Chief attended
the event and the volunteers received a Mayor's Citation for
their extraordinary efforts.
Partners in Time Highlights for 2006
As part of the Macy’s nationwide launch in September, the
Partners in Time volunteer program rolled out to Macy’s
Midwest and Macy’s North. In 2006 Macy’s Midwest
volunteers provided gifts for more than 40 St. Louis families
through the 100 Neediest Families program, collected cold
weather accessories for City Mission in Huntington, WV
and volunteered at the Central Missouri Food Bank, among
other projects. Volunteers at Macy’s North continued their
community partnerships through efforts such as hosting a
Halloween party for the Minneapolis Children’s Hospital,
serving dinners at a homeless shelter and rehabbing houses
for the Hearts & Hammers charity in Minneapolis. 2006 also
saw more employee volunteers at Macy’s Home Store and
macys.com as they created new service projects for their
divisions.
Nationwide, volunteer projects that benefit children and
youth represented 43,000 hours of service. Many projects
include tutoring or mentoring such as the Everybody Wins
“Power Lunch” reading program at Macy’s East in New York
City, the Macy’s Northwest one-to-one tutoring program
with Seattle children and the Bloomingdale’s partnership
with Mentoring USA at PS 59 in New York. Also popular are
adopt-a-family efforts that benefit children in need, such as
Bloomingdale’s Old Orchard store in Illinois aiding the Skokie
Human Services program and The FACS Group support of
50 families and their children in Greater Cincinnati.
Among hundreds of other efforts are the Macy’s West
Build-a-Library program for dozens of schools in need;
Macy’s Merchandising Group providing career counseling
for area teens; school rehabilitation projects and supply
collections at many divisions; Macy’s Northwest volunteers
biking for the American Lung Association; Macy’s South
volunteers building reading lofts and landscaping with
students from an elementary school in the Martin Luther
King Jr. district in Atlanta; and Federated Logistics and
Operations’ ongoing Pen Friends program in Tukwila,
Washington.
In all, Partners in Time volunteers gave about 5,000 hours
in service for HIV/AIDS-related efforts including walks
throughout the country. Whether in Miami or Las Vegas,
New York or Houston, Sacramento or Seattle, our spirited
teams helped to raised funds and awareness. Federated had
the No. 1 team for AIDS Walk Atlanta as 100 volunteers from
Macy’s, Bloomingdale’s, Federated Systems Group and
Federated Logistics and Operations joined together to raise
$43,000. More than 225 Macy’s North walkers joined
Chairman Frank Guzzetta for the Minnesota AIDS Walk.
Volunteers also served meals for HIV/AIDS clients in several
cities, wrapped holiday presents and worked behind the
scenes for fundraising events.
Support for breast cancer research and awareness is
strong. Nearly 7,000 hours of service were given through
participating in walks nationwide – from North Carolina to
Boston, San Diego to New Jersey, Connecticut to Tampa –
and other creative efforts. Throughout the country, Partners
in Time volunteers hit the pavement for the Komen Race for
the Cure, the Revlon Run/Walk and the American Cancer
Society’s Making Strides for Breast Cancer events. Federated
has sponsored the Komen Race in Cincinnati since its onset,
and a combined Macy’s, Corporate Office and Federated
Logistics and Operations team was the largest “big
company” team for 2006. About 400 volunteers continued
an important St. Louis tradition for the Komen Race for Cure
– this year wearing specially designed T-shirts featuring a
pink ribbon entwined with the Gateway Arch. All told, St.
Louis donations reached more than $15,000. In addition to
funds, volunteers raised awareness for the cause by selling
pink ribbons and key chains, staffing booths and giving out
Macy’s shopping bags at walks, and creating educational
rallies and luncheons.
Social Responsibility
There is no shortage of talk about the obligation of public companies to be socially responsible to the
people and communities where they do business. At Federated, we hold those same beliefs – along
with a belief that actions speak louder than words when it comes to helping tackle some of the
toughest problems facing us today.
Sweatshops and Child Labor
Environment
In 1995, following government investigations into
sweatshop conditions and incidents of child labor by some
manufacturers of products for the American marketplace,
Federated adopted a stringent Vendor/Supplier Code of
Conduct that sets out specific standards and requirements
for any vendor doing business with Federated. All of the
company’s vendors are required to sign written affirmations,
agreeing to comply with the company’s Code of Conduct
that are designed to protect workers in this country and
abroad. Among other things, the Code requires Federated’s
vendors to allow unannounced factory inspections for
contractual compliance, as well as for compliance with laws
and regulations dealing with child or forced labor and
unsafe working conditions. Inspections of factories engaged
in the production of private brand merchandise for the
company are made routinely, and violations can lead to
termination by the company for noncompliance with the
Code. (Federated’s policy on sweatshops and forced or
child labor is posted at www.fds.com. The company’s
Vendor/Supplier Code of Conduct is available by
calling 1-800-261-5385.)
While retailers face fewer environmental challenges than
do most manufacturing companies, Federated remains
committed to protecting the environment and the quality
of life in the communities where we live and work. From
recycling programs that are in place throughout the
company to capital expenditures for energy-efficiency
upgrades in stores and facilities, Federated is engaged in
numerous ongoing environmental conservation efforts
nationwide. Outside experts are hired to conduct annual
environmental audits to ensure that our facilities are in
compliance with local, state and federal environmental laws.
In addition, the company promotes the purchase and use of
recycled materials whenever possible; it routinely monitors
and regulates indoor air quality standards, maintains
policies to ensure compliance with prohibitions against the
use of ozone-depleting substances, and consistently
employs strict procedures for the storage, handling and
disposal of hazardous waste.
Welfare-to-Work
In cities from coast to coast, Federated divisions are active
partners with local governments and service organizations
in ongoing programs helping to prepare welfare recipients
to move into gainful employment. In addition to providing
hands-on assistance in developing job criteria and specific
training curricula, Federated’s stores and central division
offices have provided much-needed employment
opportunities for many former welfare recipients who are
entering the workforce, often for the first time. At Macy’s in
New York City, for instance, the division has been publicly
recognized by the Office of the Mayor for its leadership in
working with various local service agencies to develop
job-training programs specifically tailored to the needs of
the retail sector and for hiring more than 200 program
graduates during the first 18 months of this successful
public-private partnership.
Consumer Choice
In a free society as eclectic and ethnically varied as ours,
customers expect and demand a range of choices that meet
their individual needs and fashion preferences. In our role as
retailers, we recognize that it is the consumer who
ultimately will determine what products will continue to be
viable retail offerings. Those decisions are made daily at the
cash register by individual consumers and function as a
singularly effective barometer for determining what will
and will not be sold by retailers in a free and open marketplace. Varied and conflicting viewpoints about what should
or should not be sold underscore our belief that factors
unrelated to the workings of a free economy are inappropriate determinants of retail offerings. For example, while
we respect the views of individuals who choose not to buy
or wear fur, we also respect the wishes of many others who
are our customers and who want to make such choices for
themselves.
Federated is involved in other crucial issue areas as well.
Over the last four years the company has initiated and
completed an extensive readily achievable upgrading of
stores and facilities to comply with the Americans With
Disabilities Act. The company also has actively participated
in facilitating consumer product recalls, in industry efforts to
safeguard consumer privacy, and in preventing credit fraud
and abuses of personal bankruptcy laws that cost American
families millions of dollars annually.
Financial Overview
Karen Hoguet
Executive Vice President and CFO
Financial Overview
Financial Results Exceed Expectations in Year of Change
Despite a year of intense change, Federated exceeded its same-store sales and
earnings forecasts in fiscal 2006. Paced by a strong 6.1 percent increase in fourth quarter
same-store sales, same-store sales for 2006 as a whole increased by 4.4 percent – the
largest increase in any year since 1999. The company remained on track to reach an
EBITDA rate of 14 percent to 15 percent – our historic peak level of profitability – by the
2008-2009 period.
For the 53 weeks of fiscal 2006, Federated reported earnings per diluted share from continuing operations
of $1.80, compared to $3.16 per share for the 52 weeks of fiscal 2005. Excluding the May Company merger
integration costs and related inventory valuation adjustments of 72 cents per diluted share ($628 million
pre-tax, $393 million after tax) and a gain on the sale of receivables of 22 cents per diluted share ($191 million
pre-tax, $119 million after tax), earnings from continuing operations per diluted share for fiscal 2006 were
$2.30. This compares with fiscal 2005 earnings per diluted share from continuing operations of $2.55,
excluding merger integration costs, related inventory valuation adjustments and a gain on the sale of
credit receivables. Fiscal 2005 earnings include May Company results from Aug. 30 forward.
In fiscal 2006, Federated generated $3.692 billion in cash flow from continuing operating activities,
compared to $4.145 billion in fiscal 2005. Federated generated $1.273 billion of cash from continuing
investing activities in fiscal 2006, compared to $4.701 billion used by continuing investing activities in
fiscal 2005. Cash used by continuing financing activities was $4.013 billion in fiscal 2006, compared to
$58 million the previous year.
Cash generated from continuing operating activities in 2006 includes $1.860 billion in proceeds from the
sale of the May Company credit card receivables. Cash from continuing investing activities in 2006 includes
$1.047 billion in proceeds from the sale of Lord & Taylor, $740 million in proceeds from the sale of David’s
Bridal and Priscilla of Boston, and Federated’s repurchase
of $1.141 billion in credit card receivables from General
Electric Capital Corporation, which were then sold to Citi
for $1.323 billion (for a net increase of $182 million), as
well as $679 million from the disposal of property and
equipment, primarily from the sale of approximately
65 duplicate store locations.
Cash from continuing financing activities reflects the
issuance of $1.146 billion of senior notes and the repayment
of $2.680 billion of debt, including $1.0 billion pursuant to a
debt tender offer. The debt tender offer was financed by
senior notes and other debt repayments were financed from
the proceeds of the sale transactions mentioned above.
Capital Expenditures
Federated’s capital expenditures (including capitalized
software) totaled $1.392 million in 2006. In 2007, the
company expects to spend $1.2 billion for new capital
projects, including investment in direct-to-consumer
business, point of sale upgrades and continued distribution
network improvements, as a result of adding former May
Company stores to our network. In each of 2008 and 2009,
capital expenditures are expected to be $1.1 billion.
Over the next three years, the company has allocated
about 75 percent of its capital budget to new stores, store
remodels, expansions and maintenance, including
rebranding and reinvent initiatives.
Elements of the reinvent concept will continue to be
rolled out to stores nationwide in 2007 and beyond, focusing
on the former May Company locations. These elements
include improved visual presentations and signage, upscale
shopping buggies, price-checking scanners, enhanced
fitting rooms and customer lounges.
New stores will account for approximately 13 percent of
capital spending for the years 2007-2009. Before the fourth
quarter of 2007, the company intends to open six new
department stores and two new furniture galleries. New
Macy’s will open in Bolingbrook, IL; Boston, MA; Collierville,
TN; and Austin, TX. Macy’s furniture galleries will include a
new location in Lake Grove, NY, and a replacement store in
Littleton, CO. New Bloomingdale’s will open in Costa Mesa,
CA, and Chevy Chase, MD.
New technology/distribution accounts for the remaining
25 percent of the 2007-2009 capital-spending plan.
Federated continues to invest in technology to improve its
operations and customers’ experiences in our stores.
Capital Spending 2007-2009
25%
42%
20%
Reinvent, Minor
Remodels and
Maintenance
12%
13%
Financial Overview
Federated Sales by Month
(in millions)
2006
Month
2005
Sales
February
March
April
$ 1,800
2,255
1,875
1st QTR
$ 5,930
May
June
July
$ 2,024
2,366
1,605
2nd QTR
$ 5,995
August
September
October
$ 1,724
2,300
1,862
3rd QTR
$ 5,886
November
December
January
$ 2,382
4,995
1,782
4th QTR
$ 9,159
TOTAL
$ 26,970
(1)
# Stores
868
861
861
% Change
Comp-Store
Sales
1.0%
0.0%
-0.8%
0.0%
861
859
856
9.2%
1.7%
3.3%
4.6%
854
855
857
3.8%
6.2%
7.7%
5.9%
860
860
858
8.5%
4.4%
8.6%
Month
Sales(1)
February
March
April
1st QTR
$ 1,097
1,371
1,173
$ 3,641
459
459
459
1.8%
3.4%
2.8%
2.6%
May
June
July
2nd QTR
$ 1,189
1,436
998
$ 3,623
460
460
460
0.8%
2.9%
(0.9)%
1.1%
August
September
October
3rd QTR
$ 1,068
2,464
2,023
$ 5,555
459
933
935
1.1%
1.3%
(0.7)%
0.6%
November
December
January
4th QTR
$ 2,617
5,459
1,495
$ 9,571
935
934
868 (2)
(3.4)%
3.4%
1.0%
1.1%
TOTAL
$22,390
6.1%
4.4%
2004
Month
(2) Excludes stores that began clearance sales on Jan. 29, 2006.
1.3%
Comp-Store
Sales Increase
Comp-Store
Sales Increase
(1) Excludes May Company stores prior to Aug. 30, 2005, and
the Bridal Group and Lord & Taylor for all periods.
% Change
Comp-Store
# Stores(1)
Sales
Sales
% Change
Comp-Store
# Stores
Sales
February
March
April
1st QTR
$ 1,080
1,326
1,144
$ 3,550
458
458
459
9.0%
6.8%
5.4%
6.9%
May
June
July
2nd QTR
$ 1,182
1,394
1,005
$ 3,581
457
457
457
2.9%
3.4%
3.7%
3.3%
August
September
October
3rd QTR
$ 1,056
1,361
1,108
$ 3,525
457
458
459
(2.4)%
0.1%
4.0%
0.4%
November
December
January
4th QTR
$ 1,446
2,856
818
$ 5,120
459
459
459
(1.4)%
2.3%
(0.4)%
0.8%
TOTAL
$15,776
2.6%
Comp-Store
Sales Increase
Consolidated Statements of Income
(dollars in millions, except per share data)
2006
Net sales.....................................................................................................................
$ 26,970
Cost of sales .....................................................................................................................
2005
$ 22,390
(16,019 )
Inventory valuation adjustments – May integration.......................................
–
9,093
39.9 %
Selling, general and administrative expenses ..................................................
(9,382 )
(25 )
10,773
Percent to sales...............................................................................................................
$ 15,776
(13,272 )
(178 )
Gross margin ...................................................................................................................
2004
6,394
40.6 %
(8,678 )
40.5 %
(6,980 )
(4,994 )
Percent to sales...............................................................................................................
(32.2 )%
(31.2 )%
(31.6 )%
May integration costs ..................................................................................................
(450 )
(169 )
–
Percent to sales...............................................................................................................
(1.6 )%
(0.7 )%
–
Gain on the sale of accounts receivable...............................................................
191
480
–
Operating income .........................................................................................................
1,836
2,424
1,400
Interest expense.............................................................................................................
(451 )
(422 )
(299 )
Interest income ..............................................................................................................
61
42
15
Income from continuing operations before income taxes...........................
1,446
2,044
1,116
Federal, state and local income tax expense......................................................
(458 )
Income from continuing operations......................................................................
988
Income from discontinued operations, net of income taxes.......................
Net income...............................................................................................................
(671 )
(427 )
1,373
7
689
33
–
$
995
$
1,406
$
689
$
1.80
$
3.16
$
1.93
$
1.81
$
3.24
$
1.93
Diluted earnings per share:
Income from continuing operations*............................................................
Income from discontinued operations .........................................................
Net income...............................................................................................................
.01
.08
–
* For diluted earnings per share on a non-GAAP basis and a reconciliation to reported GAAP figures, please see the following:
2006
2005
2004
Diluted earnings per share:
Income from continuing operations..............................................................
$
Add back impact of May merger integration costs
and related inventory valuation adjustments............................................
$
.72
Deduct impact of the gains on the
sale of accounts receivable ................................................................................
Income from continuing operations, excluding certain items ............
1.80
2.30
$
.28
(.22 )
$
3.16
–
(.89 )
$
2.55
1.93
–
$
1.93
Financial Overview
Condensed Consolidated Balance Sheets
(in millions)
ASSETS
February 3,
2007
January 28,
2006
Cash and cash equivalents ...................................................................
Accounts receivable ................................................................................
Merchandise inventories .......................................................................
Supplies and prepaid expenses..........................................................
Assets of discontinued operations ....................................................
$ 1,211
517
5,317
251
126
$
Total Current Assets ...............................................................................
7,422
10,145
Property and equipment – net ...........................................................
Goodwill.......................................................................................................
Other intangible assets – net...............................................................
Other assets................................................................................................
11,473
9,204
883
568
12,034
9,520
1,080
389
Total Assets ................................................................................................
$ 29,550
$ 33,168
$
$
248
2,522
5,459
203
1,713
LIABILITIES & SHAREHOLDERS’ EQUITY
Short-term debt ........................................................................................
Accounts payable & accrued liabilities ............................................
Income taxes ..............................................................................................
Deferred income taxes ...........................................................................
Liabilities of discontinued operations..............................................
650
4,944
665
52
48
1,323
5,246
454
103
464
Total Current Liabilities.....................................................................
6,359
7,590
Long-term debt.........................................................................................
Deferred income taxes ...........................................................................
Other liabilities ..........................................................................................
Shareholders’ equity................................................................................
7,847
1,728
1,362
12,254
8,860
1,704
1,495
13,519
Total Liabilities & Shareholders’ Equity .....................................
$ 29,550
$ 33,168
Condensed Consolidated Statements of Cash Flows
(in millions)
2006
2005
2004
Income from continuing operations .............................................................
$ 988
$1,373
$ 689
Depreciation and amortization .......................................................................
1,265
976
734
Gains on the sale of accounts receivable ....................................................
(191)
(480)
–
May Company integration costs .....................................................................
628
194
–
Proceeds from sale of proprietary accounts receivable ........................
1,860
2,195
–
Increase (decrease) in working capital and other, net ...........................
(858)
(113)
84
Net cash provided by continuing operating activities ...................
3,692
4,145
1,507
Capital expenditures for property and
equipment and capitalized software ............................................................
(1,392)
(656)
(548)
Acquisition of May Company, net of cash acquired................................
–
(5,321)
–
Proceeds from the disposition of discontinued operations ................
1,787
–
–
Proceeds from the sale of repurchased receivables, net.......................
182
–
–
Proceeds from sale of non-proprietary accounts receivable...............
–
1,388
–
Disposition of property and equipment......................................................
679
19
27
Other, net .................................................................................................................
17
(131)
(206)
Net cash provided (used) by continuing investing activities.......
1,273
(4,701)
(727)
Debt issued..............................................................................................................
1,146
4,580
186
Debt repaid.........................................................................................................
(2,680)
(4,755)
(365)
Dividends paid .......................................................................................................
(274)
(157)
(93)
Acquisition of treasury stock ............................................................................
(2,500)
(7)
(901)
Issuance of common stock................................................................................
382
336
298
Other, net .................................................................................................................
(87)
(55)
38
Net cash provided by continuing financing activities ....................
(4,013)
(58)
(837)
Net cash provided (used) by continuing operations ..............................
952
(614)
(57)
Net cash used by discontinued operations................................................
11
(6)
–
Net increase (decrease) in cash .......................................................................
963
(620)
(57)
Cash at beginning of period.............................................................................
248
868
925
Cash at end of period ..........................................................................................
$ 1,211
$ 248
$ 868
Cash flows from continuing operating activities:
Cash flows from continuing investing activities:
Cash flows from continuing financing activities:
Financial Overview
Fiscal 2006
Comparison of the 53 Weeks Ended February 3,
2007 and the 52 Weeks Ended January 28, 2006
Net income for 2006 decreased to $995 million compared to
$1,406 million for 2005, reflecting strong sales and gross margin
performance offset by higher May integration costs and related
inventory valuation adjustments and smaller gains on the sale
of accounts receivable.
based compensation expense was $91 million for 2006, compared
to $10 million for 2005. The SG&A rate for 2006 benefited by the
achievement of more than $175 million of cost savings resulting
from merger synergies.
May Integration Costs
May integration costs for 2006 and 2005 amounted to $450 million
and $169 million, respectively, primarily related to store and
distribution center closings, as well as system conversions and other
operational consolidations. May integration costs for 2006 also
included re-branding-related marketing and advertising costs and
were partially offset by gains from the sale of Federated locations.
Net Sales
Net sales for 2006 totaled $26,970 million, compared to net sales
of $22,390 million for 2005, an increase of $4,580 million or 20.5
percent. Net sales for 2006 and for the period September 2005
through January 2006 include the continuing operations of May,
which represented $9,832 million and $6,473 million, respectively.
On a comparable-store basis (sales from Bloomingdale’s and Macy’s
stores in operation throughout 2005 and 2006 and all Internet sales
and mail-order sales from continuing businesses and adjusting for
the impact of the 53rd week in 2006), net sales increased 4.4 percent
in 2006 compared to 2005. Sales in 2006 were strongest at Macy’s
Florida and Bloomingdale’s, and comparable store sales were
strongest at Macy’s East, Macy’s Florida and Bloomingdale’s. Sales
for 2006 in the newly re-branded Macy’s stores were lower than
anticipated. Sales of the Company’s private label brands continued
to be strong in 2006 and increased to 18.2 percent of net sales in
legacy Macy’s-branded stores. By family of business, sales in 2006
were strongest in dresses, handbags, cosmetics and fragrances and
young men’s. The weaker businesses during 2006 continued to be
in the big-ticket home-related areas.
Cost of Sales
Cost of sales was $16,019 million or 59.4 percent of net sales for
2006, compared to $13,272 million or 59.3 percent of net sales for
2005, an increase of $2,747 million. Cost of sales for the period
September 2005 through January 2006 includes the continuing
operations of May, which represented $3,894 million or 60.2 percent
of May net sales. The cost of sales rate in 2006 was essentially flat
with the cost of sales rate in 2005. In addition, gross margin includes
$178 million and $25 million of inventory valuation adjustments
related to the integration of May and Federated merchandise
assortments in 2006 and 2005, respectively. The valuation of
department store merchandise inventories on the last-in, first-out
basis did not impact cost of sales in either period.
Selling, General and Administrative Expenses
Selling, general and administrative (SG&A) expenses were
$8,678 million or 32.2 percent of net sales for 2006, compared to
$6,980 million or 31.2 percent of net sales for 2005, an increase of
$1,698 million. SG&A expenses for the period September 2005
through January 2006 include the continuing operations of May,
which represented $1,951 million or 30.1 percent of May net sales.
The SG&A expense rate for 2006 was negatively impacted by higher
depreciation and amortization expense, higher retirement expenses,
and higher stock-based compensation expenses, including the
expensing of stock options. Depreciation and amortization expense
was $1,265 million for 2006, compared to $976 million for 2005.
Pension and supplementary retirement plan expense amounted to
$158 million for 2006, compared to $129 million for 2005. Stock-
Gains on Sale of Accounts Receivable
Pre-tax gains of approximately $191 million and $480 million were
recorded in 2006 and 2005, respectively, in connection with the sale
of certain credit card accounts and receivables.
Net Interest Expense
Net interest expense was $390 million for 2006, compared to
$380 million for 2005, an increase of $10 million. The increase in
interest expense during 2006 as compared to 2005 is due to the
increased levels of borrowings associated with the acquisition of
May, offset in part by a gain of approximately $54 million related
to the completion of a debt tender offer in the fourth quarter of
2006. Net interest expense for 2006 and 2005 each includes
approximately $17 million of interest income related to the
settlement of various tax examinations.
Income Taxes
The Company’s effective income tax rates of 31.7 percent for
2006 and 32.8 percent for 2005 differ from the federal income
tax statutory rate of 35.0 percent, and on a comparative basis,
principally because of the settlement of tax examinations, the
reduction in the valuation allowance associated with capital loss
carryforwards and the effect of state and local income taxes.
Federal, state and local income tax expense for 2006 included a
benefit of approximately $80 million recorded in the second
quarter related to the settlement of various tax examinations,
primarily attributable to losses related to the disposition of a
former subsidiary. Federal, state and local income tax expense
for 2005 included a benefit of approximately $85 million related
to the reduction in the valuation allowance associated with the
capital loss carryforwards realized as a result of the sale of the
FDS Credit Assets and $10 million related to the settlement of
various tax examinations.
Discontinued Operations
For 2006, income from the discontinued operations of the acquired
Lord & Taylor and Bridal Group businesses, net of income taxes,
was $7 million on sales of approximately $1,741 million. For 2006,
discontinued operations also includes the loss on disposal of the
Lord & Taylor division of $38 million after income taxes and the loss
on disposal of the David’s Bridal and Priscilla of Boston businesses
of $18 million after income taxes. The losses on disposal reflect
reductions to the fair value of the assets sold based on the actual
purchase agreements. For 2005, income from the discontinued
operations of the acquired Lord & Taylor and Bridal Group
businesses, net of income taxes, was $33 million on sales of
approximately $957 million.
Division Review
Retail Operations
Bloomingdale’s
Macy’s East
Macy’s Florida
Macy’s Midwest
Macy’s North
Macy’s Northwest
Macy’s South
Macy’s West
macys.com
Division Review
Bloomingdale’s
100 Third Avenue | New York, NY 10022 | 212-705-2000
*as of 3/3/07
2006 Annual Sales: $2.317 billion | # of Stores: 38* | Total Store Gross Square Feet: 8.668 million* | Employees: 12,200
Bloomingdale’s, a leader in department store fashion, serves
customers through 38 stores in 12 states. It focuses on upscale
fashion apparel and home-related goods, with an emphasis on
distinctive merchandise offerings.
Known worldwide for its fashion sense and merchandising
savvy, Bloomingdale’s helped launch the careers of many nowfamous designers. Among them are Ralph Lauren, Tommy Hilfiger,
Calvin Klein and Donna Karan. New designers are being
showcased today at Bloomingdale’s and could well be the
stars of tomorrow.
Michael Gould
Chairman
Bloomingdale’s fabled Manhattan flagship on 59th Street
and Lexington Avenue anchors a group of 11 locations in the
Greater New York metropolitan area. In addition, the division
operates eight stores in California, two in each of the Philadelphia,
Washington, D.C., Boston and Atlanta markets, five in southeast
Florida, four in Chicago, and one each in Bloomington, MN, and
Las Vegas.
In Fall 2006, Bloomingdale’s opened a spectacular new
West Coast flagship in San Francisco, as well as a new store
in San Diego. In 2007, it will convert former May Company
locations in Washington, D.C., and Southern California to the
Bloomingdale’s nameplate.
Bloomingdale’s was founded in 1872 by Lyman and Joseph
Bloomingdale on 56th Street in New York.
California
Florida
Georgia
Illinois
Maryland
Massachusetts
Minnesota
Nevada
New Jersey
New York
Pennsylvania
Virginia
The Bloomingdale brothers had the foresight to open in a
part of town that was about to boom. New York’s “silk stocking
district” grew up around the store, which soon moved to its
current location and, by 1931, covered an entire square block.
It became part of Federated in 1930, a year after the parent
company was founded.
Bloomingdale’s has been described more as a lifestyle than
as a store, creating a tradition of exceptional shopping not only
for New Yorkers but for visitors from everywhere in the world.
The Bloomingdale’s division operates the Bloomingdale’s by Mail
national fashion catalog and bloomingdales.com online site.
Bloomingdale’s is led by Chairman Michael Gould. Gould
was named to his position in 1991 after serving as president
and CEO of Giorgio Beverly Hills, and as chairman and CEO
of J.W. Robinson’s department stores in Southern California.
“Tina was amazing in helping us prepare and execute our bridal registry this past year. She went
overboard on multiple occasions in order to facilitate our experience with the bridal registry at
Bloomingdale’s. We moved our entire registry to Bloomingdale’s largely as a result of the excellent
customer care illustrated by Tina. She could not have done a better job.” – Allan M., Boston, MA
Bloomingdale’s
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Beverly Center
Century City
Fashion Island
Fashion Island Home
Stanford
Fashion Valley
Downtown San Francisco
Sherman Oaks
1997
1996
1996
1996
1996
2006
2006
1996
163
235
172
68
229
226
335
229
Bloomington
Boca Raton
Aventura
The Falls
The Mall at Millenia
The Gardens (PGA)
1986
1997
1984
2002
1990
270
252
229
237
235
New York
Lenox Square
Perimeter Mall
2003
2003
281
234
Medinah Home
North Michigan Ave.
Oakbrook Home
Old Orchard
2003
1988
2003
1995
130
256
93
206
California
Beverly Hills
Los Angeles
Newport Beach
Newport Beach
Palo Alto
San Diego
San Francisco
Sherman Oaks
Georgia
Atlanta
Atlanta
White Flint
1977
259
Chestnut Hill
Chestnut Hill
1973
2006
124
186
Mall of America
1992
233
Fashion Show Mall Home
2002
99
Bridgewater Commons
Riverside Square
Short Hills Mall
Willowbrook
2002
1959
1967
2002
161
293
246
274
Roosevelt Field
Roosevelt Field Furniture Gallery
Walt Whitman
59th Street/Lexington
Soho
Westchester Furniture (Clearance)
White Plains
1995
2004
1998
1886
2004
2004
1975
309
69
231
859
122
64
300
King of Prussia
Willow Grove
1981
1982
248
239
Tysons Corner
1976
272
2007
2007
289
165
New Jersey
Bridgewater
Hackensack
Short Hills
Wayne
Garden City
Garden City
Huntington
Manhattan
Manhattan
Mt. Pleasant
White Plains
King of Prussia
Willow Grove
Virginia
New Store Openings
Massachusetts
Newton
Newton
Gross Sq. Ft.
(in 000s)
Nevada
Las Vegas
McLean
Maryland
Kensington
Year
Opened
Pennsylvania
Illinois
Chicago
Chicago
Oakbrook
Skokie
Mall/Location
Minnesota
Florida
Boca Raton
Miami
Miami
Orlando
West Palm Beach
State/City
Costa Mesa, CA
Chevy Chase, MD
Division Review
Macy’s East
151 W. 34th Street | New York, NY 10001 | 212-695-4400
*as of 3/3/07
Macy’s East, based in New York City, operates 188 stores in 12
states, the District of Columbia and Puerto Rico. The company’s
flagship store on Herald Square in Manhattan, which opened in
1902, is the world’s largest store and is a unique and popular New
York City destination.
Ronald Klein
Chairman
James E. Gray
President
Macy’s East traces its roots to dry goods stores first opened in
the mid-1800s. Eben Jordan and Benjamin L. Marsh established
Jordan Marsh in Boston in 1841, while Rowland H. Macy launched
R.H. Macy & Co. in New York City in 1858. Both stores grew to be
prominent retailing forces in their respective markets and
branched out over the years.
Macy’s moved to its current Herald Square location in 1902.
In 1924, completion of a Seventh Avenue addition made it the
world’s largest store concurrent with the first Thanksgiving
Day parade.
In 2001, 17 former Stern’s locations were converted to
Macy’s stores.
Early in 2003, Macy’s stores in the Atlanta market were
integrated with Rich’s locations into Rich’s-Macy’s stores operated
by the Atlanta-based Rich’s/Lazarus/Goldsmith’s-Macy’s division.
Macy’s stores in Florida were integrated with Burdines locations
into Burdines-Macy’s stores late in 2003.
Connecticut
Delaware
Maine
Maryland
Massachusetts
New Hampshire
New Jersey
New York
Pennsylvania
Rhode Island
Vermont
Virginia
Washington, D.C.
Puerto Rico
In September 2006, certain stores previously part of the May
Company – Hecht’s, Filene’s, Strawbridge’s and Kaufmann’s – were
converted to the Macy’s nameplate.
Chairman Ron Klein and President Jim Gray head the Macy’s
East management team.
Klein was named chairman in 2004, after serving as chairman
of Rich’s/Lazarus/Goldsmith’s. Previously, he served as vice
chairman and director of stores for Macy’s East, chairman of
Federated’s former Stern’s division, and has served in a number
of merchandising positions for other Federated divisions.
Before becoming president of Macy’s East in 1994, Gray, now a
43-year Federated veteran, was president of Burdines in Florida
and also previously served as chairman of Bullock’s in Los Angeles.
“Nice, open layout of merchandise; clean fitting rooms; loved the price check
scanner at the fitting room.” – Patricia G., Bedford Hills, NY
Macy’s East
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Danbury Fair
Westfarms Home
Westfarms Mall
Enfield Square
Enfield Square Home
Shoppes at Buckland Hills
Shoppes at Buckland Hills Home
Meriden Square
Connecticut Post Mall
Stamford
Trumbull Shopping Park
Brass Mill Center
Waterford
1987
1993
1993
1971
1971
1990
2004
1971
1991
1982
1978
1997
1984
241
80
213
166
76
151
106
179
225
255
201
166
120
Dover Mall
Christiana Mall
Concord Mall
Concord Mall Home
1997
1979
1983
1983
140
217
153
56
Bangor
Portland
1998
1969
143
194
Annapolis
Security Square Mall
White Marsh Mall
White Marsh Home
Harford Mall
Harford Mall Furniture Gallery
Montgomery Mall
Montgomery Mall Home
Bowie Town Center
The Mall in Columbia
Francis Scott Key Mall
Lakeforest Mall
Marley Station
Valley Mall
Prince Georges Plaza
Laurel Centre Mall
Marlow Heights Shopping Center
Owings Mills Town Center
Centre at Salisbury
Towson Town Center
St. Charles Towne Center
St. Charles Towne Home
Wheaton Plaza Mall
1979
1979
1991
2006
1981
1981
1968
1968
2001
1975
1993
1978
1987
1999
1958
1981
1960
1986
1991
1982
1990
1990
2005
201
155
165
59
141
25
213
76
160
237
141
170
164
120
177
123
160
164
138
204
179
55
174
Auburn Mall
Auburn Home
Belmont Center
Downtown
Southshore
Westgate
Burlington
Cambridgeside Galleria
Cambridgeside Galleria
Framingham Furniture Gallery
Hanover Mall
1997
1997
1978
1950
1961
2003
1968
1990
1990
1994
1972
167
88
75
389
255
144
255
91
43
41
110
Connecticut
Danbury
Farmington
Farmington
Hartford
Hartford
Manchester
Manchester
Meriden
Milford
Stamford
Trumbull
Waterbury
Waterford
Maine
Bangor
Portland
Maryland
Annapolis
Baltimore
Baltimore
Baltimore
Bel Air
Bel Air
Bethesda
Bethesda
Bowie
Columbia
Frederick
Gaithersburg
Glen Burnie
Hagerstown
Hyattsville
Laurel
Marlow Heights
Owings Mills
Salisbury
Towson
Waldorf
Waldorf
Wheaton
Massachusetts
Auburn
Auburn
Belmont
Boston
Braintree
Brockton
Burlington
Cambridge
Cambridge
Framingham
Hanover
Year
Opened
Gross Sq. Ft.
(in 000s)
1972
1978
1989
1994
2002
1996
1965
1989
1989
2004
1993
1994
1994
1995
1988
1992
13
119
149
111
140
200
210
185
120
141
219
179
127
202
102
152
Bedford
The Mall of New Hampshire
Pheasant Lane Mall
Newington
Fox Run Mall
Mall at Rockingham Park
1966
1996
1993
1983
1983
1991
180
166
150
78
59
166
Bridgewater
Burlington Center
Cherry Hill Furniture Gallery
Cherry Hill Mall
Deptford Mall
East Brunswick
Monmouth
Route 35 Furniture Gallery
Menlo Park
Raceway Mall
Newport Center
Quaker Bridge
Ledgewood Mall
Livingston
Hamilton
Moorestown Mall
North Brunswick Furniture Gallery
Garden State Plaza
Paramus Furniture Gallery
Paramus Park
Rockaway
Short Hills
Middlesex
Ocean County
Echelon Mall
Preakness
Willowbrook
Essex Green Plaza
Woodbridge
1988
1982
2001
1962
1975
1970
1960
1980
1959
1998
2002
1976
1994
1971
1987
1999
1995
1957
2000
1974
1977
1981
1976
1962
1977
1970
1963
1972
1967
1975
1971
259
185
61
334
208
244
289
37
351
244
224
215
73
266
259
200
38
485
77
303
262
279
81
40
170
224
81
63
380
93
278
Mall/Location
Massachusetts (continued)
Delaware
Dover
Newark
Wilmington
Wilmington
State/City
Hanover
Hyannis
Kingston
Lanesboro
Leominster
Marlborough
Natick
North Attleboro
North Attleboro
North Dartmouth
Peabody
Saugus
Springfield
Springfield
Swansea
Taunton
Hanover Mall Furniture Gallery
Cape Cod
Independence Mall
Berkshire Mall
Searstown Mall
Solomon Pond Mall
Natick Mall
Emerald Square
Emerald Square
Dartmouth Mall
North Shore Mall (Peabody)
Square One Mall
Eastfield Mall
Holyoke Mall at Ingleside
Swansea
Silver City Galleria
New Hampshire
Bedford
Manchester
Nashua
Newington
Newington
Salem
New Jersey
Bridgewater
Burlington
Cherry Hill
Cherry Hill
Deptford
East Brunswick
Eatontown
Eatontown
Edison
Freehold
Jersey City
Lawrenceville
Ledgewood
Livingston
Mays Landing
Moorestown
North Brunswick
Paramus
Paramus
Paramus
Rockaway
Short Hills
South Plainfield
Springfield
Toms River
Vorhees
Wayne
Wayne
Wayne
West Orange
Woodbridge
Division Review
Macy’s East
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Colonie
Crossgates Mall
Boulevard Mall
Boulevard Mall Home
Bay Shore
McKinley Mall
McKinley Mall Home
Parkchester
Fulton Mall
Kings Plaza
Walden Galleria
Great Northern Mall
Commack Plaza
Shoppingtown Mall
Douglaston
Rego Park (Queens Center)
Flushing
Roosevelt Field
Hampton Bays
Broadway Mall
Walt Whitman Mall
Hudson Valley Mall
Smith Haven
Manhasset
Herald Square
Sunrise Mall
Galleria at Crystal Run
Nanuet
Carle Place (clearance)
Carle Place Furniture Gallery
Sangertown Square
Staten Island
Staten Island Furniture Gallery
Poughkeepsie Galleria
Queens Furniture Gallery
Irondequoit Mall
Mall at Greece Ridge Center
Mall at Greece Ridge Center Home
The Marketplace
Rotterdam Square
Carousel Mall
Valley Stream
Valley Stream
Eastview Mall
Palisades Center
White Plains
Eastern Hills
Cross County
Yorktown
1990
1985
1983
1983
1963
1989
1989
1941
1865
1970
1988
1989
1981
1993
1981
1995
1951
1956
1981
1956
1962
1995
1969
1965
1902
1973
1992
1969
1971
1971
1995
1965
2003
1987
2001
1990
1995
1995
1982
1995
1990
1986
2004
1971
1998
1980
1971
1987
1987
341
202
181
41
318
88
31
171
1,026
339
175
88
208
120
158
373
277
461
50
309
308
121
326
331
2,169
213
181
227
51
86
140
272
51
165
64
125
122
42
149
120
165
274
116
175
204
315
127
259
121
New York
Albany
Albany
Amherst
Amherst
Bayshore
Blasdell
Blasdell
Bronx
Brooklyn
Brooklyn
Cheektowanga
Clay
Commack
DeWitt
Douglaston
Elmhurst
Flushing
Garden City
Hampton Bays
Hicksville
Huntington Station
Kingston
Lake Grove
Manhasset
Manhattan
Massapequa
Middletown
Nanuet
Nassau
Nassau
New Hartford
New Springvale
New Springvale
Poughkeepsie
Queens
Rochester
Rochester
Rochester
Rochester
Schenectady
Syracuse
Valley Stream
Valley Stream
Victor
West Nyack
White Plains
Williamsville
Yonkers
Yorktown Heights
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Suburban Square
Neshaminy Mall
Capital City Mall
Exton Square Mall
Harrisburg East Mall
King of Prussia
King of Prussia
Oxford Valley
Montgomery
Downtown
Roosevelt Mall
Plymouth Meeting
Springfield
Lehigh Valley
Willow Grove Park Mall
West Manchester Mall
1930
1968
1995
1973
1995
1991
1995
1973
1978
1911
1995
1966
1974
1976
2001
1995
111
211
120
184
191
256
215
197
220
342
191
214
192
218
226
120
Providence Place
Warwick Mall
1999
1970
201
186
Burlington Square
1999
152
Landmark Mall
Ballston Common
Ballston Common Home
Pentagon City
Fair Oaks Mall
Fair Oaks Mall
Spotsylvania Mall
Dulles Town Center
Manassas Mall
Tysons Corner Center
Tysons Galleria
Springfield
1965
1959
1959
1989
1980
2000
1993
1998
1996
1968
1988
1991
201
352
126
307
254
220
146
181
139
243
265
287
Downtown – Metro Center
1985
272
Plaza Las Americas
2000
254
2007
2007
130
50
Pennsylvania
Ardmore
Bensalem
Camp Hill
Exton
Harrisburg
King of Prussia
King of Prussia
Langhorne
North Wales
Philadelphia
Philadelphia
Plymouth Meeting
Springfield
Whitehall
Willow Grove
York
Rhode Island
Providence
Warwick
Vermont
Burlington
Virginia
Alexandria
Arlington
Arlington
Arlington
Fairfax
Fairfax
Fredericksburg
Loudoun
Manassas
McLean
McLean
Springfield
Washington, D.C.
Washington, D.C.
Puerto Rico
San Juan
New Store Openings
Boston, MA
Lake Grove, NY (Furniture Gallery)
was neat, clean, well lit
“Store
and well presented. Had not
shopped there in several years
and was pleasantly surprised
by the improvements made.
Home Store displays were inviting
to shop and looked great! Also,
directional signing was clear
and well positioned.
”
– Joanne D., Boothwyn, PA
Division Review
Macy’s Florida
22 East Flagler Street | Miami, FL 33131 | 305-835-5151
*as of 3/3/07
Headquartered in Miami, Macy’s Florida was founded as
Burdines and has a 108-year history of serving the diverse
populations of this national and international tourist mecca.
In Fall 2007, with the addition of the Macy’s store in San Juan,
Macy’s Florida will operate more than 60 stores.
Julie Greiner
Chairman
Nirmal K. Tripathy
President
J. David Scheiner
Vice Chairman &
Director of Stores
Macy’s Florida, which celebrated its 100th year of operation
in 1998, became a leading local retailer even before Florida
became a winter tourist destination. Now that the state is the
world’s largest magnet for domestic, European and Latin
American tourists year-round, Macy’s is the preferred Florida
shopping experience.
Macy’s Florida reflects the state’s unique lifestyle. It operates
exclusively within the state, catering to the growing population
of white-collar professionals, as well as to highly diverse customer
segments that include United States and international visitors,
retirees and seasonal residents.
Macy’s Florida stores can be found in most major markets on
the Florida peninsula, with concentrations in south Florida and in
the bay area on the Gulf Coast. Over the years, the growth of this
division has mirrored the development of Florida itself.
Macy’s Florida is led by Chairman Julie Greiner, President
Nirmal K. “Trip”Tripathy and Vice Chairman and Director of Stores
J. David Scheiner.
Florida
Greiner was named chairman of the division in July 2005.
Previously, she served as senior executive vice president of the
company’s Bloomingdale’s division and was its director of stores
since April 1998. Greiner began her retailing career in 1975 at
J. W. Robinson’s (later Robinsons-May) in Los Angeles.
Tripathy was named president in December 2003 after serving
since July 2002 as the division’s executive vice president for
administration. Previously, he was chief financial officer of
Limited Stores.
Scheiner, vice chairman and director of stores, joined Burdines
in 1972. He later was president of Maas Brothers/Jordan Marsh
from 1988 to 1991, when it merged with Burdines and he became
vice chairman.
“This was my first experience with Macy’s by Appointment. Melissa was phenomenal.
I was purchasing over 20 outfits for a client, and I would not have been able to find exactly
what she needed without her! She coordinated outfits, advised me of sales, and made
the entire shopping experience fast and painless.” – Elizabeth R., Orlando, FL
Macy’s Florida
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Westland
Aventura
Aventura Mall
Cutler Ridge
Dadeland
Dadeland Home
Downtown Miami
International
Miami Beach
South Dade Furniture Gallery
The Falls
West Dade
1967
1983
1999
1981
1962
1992
1898
1982
1953
1979
2006*
1982
209
275
238
145
420
209
479
145
96
70
254
205
Boca Raton
Boca Raton Furniture Gallery
Boynton Beach
Coral Square
Coral Square
Ft. Lauderdale Furniture Gallery
Sunrise Galleria
Stuart
Palm Beach Mall
Pembroke Furniture Gallery
Pembroke Lake Mall
Pembroke Lake Mall
Broward Mall
Pompano Beach
Vero Beach
City Place
The Gardens (PGA)
Wellington Commons
1979
1999
1985
1984
1985
2002
2006*
1987
1979
1997
1992
2006
1978
1969
1996
2000
1988
2001
228
50
227
111
142
45
218
140
190
51
181
83
204
151
104
108
341
196
Daytona Beach
Lakeland Square Mall
Melbourne
Merritt Island
Altamonte Furniture Gallery
Altamonte Springs
Colonial Fashion
Florida Mall
The Mall at Millenia
Oviedo Marketplace
Seminole Town Center
Winter Haven
1982
1995
1983
1970
2000
1975
1973
1999
2002
2000
1995
1977
164
101
104
153
50
152
206
202
276
195
161
75
Dade County
Hialeah
Miami
Miami
Miami
Miami
Miami
Miami
Miami
Miami
Miami
Miami
Miami
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Bradenton
Brandon Town Center
Countryside Furniture Gallery
Countryside Mall
Edison Mall
Edison Mall
Naples
Port Charlotte Town Center
Port Richey
Sarasota
South Trail
Tyrone
Citrus Mall
Gandy Furniture Gallery
University Square
West Shore
1973
1995
2000
1975
1965
1979
1977
1994
1981
1976
1977
1972
1999
1954
1974
1966
132
142
50
213
129
168
143
85
84
152
143
162
162
61
140
236
Oaks Mall
Ocala
Tallahassee
1984
1980
1979
104
85
169
Gulf Coast
East Coast
Boca Raton
Boca Raton
Boynton Beach
Coral Springs
Coral Springs
Ft. Lauderdale
Ft. Lauderdale
Jensen Beach
Palm Beach
Pembroke Pines
Pembroke Pines
Pembroke Pines
Plantation
Pompano Beach
Vero Beach
West Palm Beach
West Palm Beach
West Palm Beach
State/City
Bradenton
Brandon
Clearwater
Clearwater
Ft. Myers
Ft. Myers
Naples
Port Charlotte
Port Richey
Sarasota
Sarasota
St. Petersburg
Tampa
Tampa
Tampa
Tampa
North
Gainesville
Ocala
Tallahassee
Central
Daytona Beach
Lakeland
Melbourne
Merritt Island
Orlando
Orlando
Orlando
Orlando
Orlando
Oviedo
Seminole
Winter Haven
* Reopened after being closed due to Hurricane Wilma damage.
Division Review
Macy’s Midwest
611 Olive Street | St. Louis, MO 63101 | 314-342-6300
*as of 3/3/07
Macy’s Midwest is one of two new Federated divisions established
in 2006.
Based in St. Louis, Macy’s Midwest operates 113 stores across
the midsection of the United States – stretching from Kansas to
western New York. It translates Macy’s fashion and affordable
luxury to customers in Illinois, Indiana, Kansas, Kentucky, Missouri,
New York, Ohio, Pennsylvania and West Virginia.
William P. McNamara Brian L. Keck
Chairman
President
John T. Harper
Vice Chairman &
Director of Stores
Macy’s Midwest encompasses the former Famous-Barr
division of May, which operated Famous-Barr, L.S. Ayres, The
Jones Store and Kaufmann’s locations. The division converted
to Macy’s in 2006.
The history of Macy’s Midwest dates back to 1910 in St. Louis.
The Macy’s Midwest management team is headed by Chairman
William P. McNamara, President Brian L. Keck and Vice Chairman
and Director of Stores John T. Harper.
McNamara was named chairman in October 2005, after serving
as vice chairman of May Company since 2000. He began his
retailing career in 1972 as an executive trainee at Filene’s, when it
was a division of Federated, rising to senior vice president and
general merchandise manager in 1986. He went on to serve as
president and CEO of Famous-Barr and president of May
Merchandising Company.
Illinois
Indiana
Kansas
Kentucky
Missouri
New York
Ohio
Pennsylvania
West Virginia
Keck served as senior vice president for human resources at
May Company before being named president of Macy’s Midwest
in October 2005. He began his career in 1986 at Famous-Barr and
went on to hold the positions of senior vice president for May’s
former shopping center development division and for Filene’s,
as well as chairman for Meier & Frank.
Harper was named vice chairman and director of stores
in December 2005, after serving as chairman of Hecht’s/
Strawbridge’s since 2004, as well as serving as the division’s senior
vice president/finance, senior vice president/operations and vice
president/profit management. Harper joined Kaufmann’s in 1983
and also has held positions with L.S. Ayres and Famous-Barr.
“I found the aisles wide and uncluttered. The fitting rooms in the Women’s Department were clean
and empty of excess clothing. Hanging directional information signs were helpful since I hadn’t
been in the store recently.” – Patricia S., Pittsburgh, PA
Macy’s Midwest
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Alton Square
Eastland Mall
University Mall
Market Place Shopping Center
St. Clair Square
Northwoods Mall
White Oak Mall
1978
1999
1991
1999
1973
1985
1977
180
154
109
191
248
165
161
College Mall
Eastland Mall
Glenbrook Square
Greenwood Park
Castleton Square
Glendale Mall
Lafayette Square
Washington Square
Tippecanoe Mall
Muncie Mall
University Park
Honey Creek Mall
1982
1982
1966
1980
1973
1958
1974
1974
1994
1996
1979
1998
88
171
248
160
310
234
143
152
156
120
169
177
Town Center Plaza
Metcalf South Shopping Center
Oak Park Mall
Oak Park Mall Home
Prairie Village Shopping Center
Prairie Village Home
West Ridge Mall
2004
1967
2002
2002
1958
1958
1988
124
221
161
25
133
27
193
Florence Mall
Florence Mall Home
Towne Square Home
Towne Square Mall
1977
1994
1998
1998
147
112
29
102
West Park Mall
Chesterfield
The Stadium Shoppes
Jamestown Mall
Independence Center
Northpark Home
Northpark Mall
Metro North Mall
Battlefield Mall
Northwest Plaza
Crestwood
Downtown – St. Louis Centre
South County
St. Louis Galleria
West County
Mid–Rivers
1981
1995
2003
1994
1986
1994
1987
1976
1982
1966
1969
1924
1963
1991
2001
1981
108
269
140
200
198
55
85
235
135
240
166
735
207
279
266
211
Oakdale Mall
Arnot Mall
2000
1995
140
120
Chapel Hill Shopping Center
Rolling Acres Shopping Center
Summit Mall
Belden Village
Canton Centre
Anderson Towne Center
1967
1978
1965
1971
1968
1969
169
103
195
133
120
161
Illinois
Alton
Bloomington
Carbondale
Champaign
Fairview Heights
Peoria
Springfield
Kansas
Leawood
Overland Park
Overland Park
Overland Park
Prairie Village
Prairie Village
Topeka
Kentucky
Florence
Florence
Owensboro
Owensboro
Missouri
Cape Girardeau
Chesterfield
Columbia
Florissant
Independence
Joplin
Joplin
Kansas City
Springfield
St. Ann
St. Louis
St. Louis
St. Louis
St. Louis
St. Louis
St. Peters
New York
Binghamton
Horsehead
Ohio
Akron
Akron
Akron
Canton
Canton
Cincinnati
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Fountain Place
Kenwood Furniture Gallery
Kenwood Towne Centre
Northgate Mall
Tri-County Mall
Columbus City Center
Eastland
Eastland Furniture Gallery
Easton Town Center
Kingsdale Center
Mall at Tuttle Crossing
Mall at Tuttle Crossing
Polaris Mall
Tuttle Furniture Gallery
Dayton Mall
Fairfield Commons
Midway
Lima Mall
Richland Mall
Great Lakes Mall
Eastwood Mall
Great Northern
Randall Park Mall
Parmatown Mall
Richmond Mall
Ohio Valley Mall
Sandusky Mall
Upper Valley Mall
Fort Steuben Mall
Stow–Kent Shopping Center
Southpark
University Square
Southern Park Mall
1997
1989
1988
1993
1960
2003
2006
1972
2001
1970
1997
2003
2001
1996
1969
1994
1990
1971
1969
1964
1969
1965
1976
1960
1998
1979
1979
1971
1974
1965
1996
2002
1970
186
71
269
191
235
180
121
72
245
108
225
227
180
41
263
152
105
195
140
190
157
231
184
288
165
101
133
156
132
82
180
165
189
Logan Valley Mall
Mill Creek Mall
Galleria at Pittsburgh
Westmoreland Mall
Westmoreland Mall Home
Shenango Valley Mall
The Waterfront
Beaver Valley Mall
Monroeville
Lycoming Mall
Natrona Heights Plaza
Downtown
Ross Park Mall
Ross Park Furniture Gallery
South Hills Furniture Gallery
South Hills Village
The Mall at Robinson
Viewmont Mall
Nittany
Washington Crown Centre
Century III
Century III Home & Clearance
Wyoming Valley Home
Wyoming Valley Mall
1995
1975
2005
1976
1976
1976
2003
1987
1969
1995
1956
1946
1986
1997
1993
1965
1998
1995
1999
1999
1979
2000
1995
1995
150
163
173
168
24
106
142
203
263
120
73
1,186
209
48
21
260
200
140
98
140
173
83
51
96
Huntington Mall
Charleston Town Center
1981
1983
162
147
Ohio (continued)
Indiana
Bloomington
Evansville
Fort Wayne
Greenwood
Indianapolis
Indianapolis
Indianapolis
Indianapolis
Lafayette
Muncie
South Bend
Terre Haute
State/City
Cincinnati
Cincinnati
Cincinnati
Cincinnati
Cincinnati
Columbus
Columbus
Columbus
Columbus
Columbus
Columbus
Columbus
Columbus
Columbus
Dayton
Dayton
Elyria
Lima
Mansfield
Mentor
Niles
North Olmsted
North Randall
Parma
Richmond Heights
St. Clairsville
Sandusky
Springfield
Steubenville
Stow
Strongsville
University Heights
Youngstown
Pennsylvania
Altoona
Erie
Frazer Heights
Greensburg
Greensburg
Hermitage
Homestead
Monaca
Monroeville
Muncy
Natrona Heights
Pittsburgh
Pittsburgh
Pittsburgh
Pittsburgh
Pittsburgh
Pittsburgh
Scranton
State College
Washington
West Mifflin
West Mifflin
Wilkes–Barre
Wilkes–Barre
West Virginia
Barboursville
Charleston
Division Review
Macy’s North
700 Nicollet Mall | Minneapolis, MN 55402 | 612-375-2200
*as of 3/3/07
Established in February 2006, the Macy’s North division operates
61 former Marshall Field’s stores that converted to the Macy’s
nameplate in September 2006. With a rich history of providing
fine merchandise and outstanding customer service, Marshall
Field’s is synonymous with elegance, style and quality in the
north and upper Midwest.
Frank J. Guzzetta
Chairman
Robert M. Soroka
President
Amy Hanson
Vice Chairman
for Administration
Based in Minneapolis, Macy’s North stores are in eight states,
including Illinois, Indiana, Michigan, Minnesota, North Dakota,
northwest Ohio, South Dakota and Wisconsin. In addition to the
former Marshall Field’s locations, in 2007 Macy’s North began
operating one former L.S. Ayres store in Indiana and a Macy’s
in Minnesota.
The roots of the Macy’s North division date back to 1852, when
Marshall Field opened his first store in downtown Chicago.
Macy’s North is led by Chairman Frank J. Guzzetta, President
Robert M. Soroka and Amy Hanson, vice chairman for administration.
Guzzetta was named chairman in December 2005, after serving
as president of Marshall Field’s since January 2005 and president
of Hecht’s/Strawbridge’s since 2000. He joined Hecht’s in 1988 as
a divisional vice president and rose to executive vice president
of merchandising. Prior to joining May, Guzzetta worked with
Woodward & Lothrop.
Illinois
Indiana
Michigan
Minnesota
North Dakota
Ohio
South Dakota
Wisconsin
Soroka was named president of Macy’s North in December
2005, after serving as chairman of Marshall Field’s since 2004.
Previously, he had served as chairman and senior vice
president/chief financial officer of Robinsons-May. Soroka
also has worked with four other May divisions in financial
and credit positions.
Hanson was named vice chairman for administration for Macy’s
North in June 2006, after serving as president of credit services at
Federated’s Financial Administrative and Credit Services (FACS)
Group division since March 2000. She joined FACS in 1991 and was
appointed senior vice president of credit operations in 1997.
Hanson joined the company in 1983.
“Quality, wide selection, pleasant store atmosphere, easily accessible service available in
all areas of shopping, i.e., alterations, exchanges, gift wrapping, special orders, pleasant
and helpful salepersons.” – Helen T., Flint, MI
Macy’s North
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Fox Valley Center
Stratford Square Mall
River Oaks Center
State Street
Water Tower Place
Hawthorn Center
Louis Joliet Mall
Market Square
Northbrook Court
Oakbrook Center
Oakbrook Center Home
Orland Square Mall
Cherryvale Mall
Woodfield Home
Woodfield Shopping Center
Old Orchard Shopping Center
Spring Hill Mall
1975
1981
1966
1868
1975
1973
1978
1931
1995
1962
1996
1976
1973
1996
1971
1956
1980
253
149
252
2,048
323
240
127
16
286
378
106
198
154
106
316
458
123
Southlake Mall
1978
168
Illinois
Aurora
Bloomingdale
Calumet City
Chicago
Chicago
Vernon Hills
Joliet
Lake Forest
Northbrook
Oakbrook
Oakbrook
Orland Park
Rockford
Schaumburg
Schaumburg
Skokie
West Dundee
Bloomington
Brooklyn Center
Burnsville
Edina
Edina
Maplewood
Minneapolis
Minnetonka
Minnetonka
Rochester
Roseville
Roseville
St. Paul
St. Cloud
Year
Opened
Gross Sq. Ft.
(in 000s)
Mall of America
Brookdale Center
Burnsville Center
Southdale Center
Southdale Center Home
Maplewood Mall
Downtown
Ridgedale Center
Ridgedale Center Home
Apache Mall
Rosedale Center
Rosedale Center Home
Downtown
Crossroads Center
1992
1966
1977
1956
1978
1996
1902
1974
1974
1972
1969
1976
1963
1976
333
195
224
426
93
230
1,276
129
202
163
270
53
362
101
West Acres Shopping Center
Columbia Mall
1973
1978
118
99
Franklin Park Mall
1971
187
The Empire Mall
1971
101
Fox River Mall
Oakwood Mall
Valley View Mall
Hilldale Shopping Center
Mayfair Mall
1991
1991
1980
1962
1959
168
104
101
174
283
2007
180
North Dakota
Fargo
Grand Forks
Ohio
Toledo
Michigan
Ann Arbor
Battle Creek
Dearborn
Flint
Grandville
Grand Rapids
Harpers Woods
Kalamazoo
Lansing
Lansing
Novi
Port Huron
Saginaw
Southfield
Sterling Heights
Sterling Heights
Taylor
Traverse City
Troy
Troy
Waterford
Westland
Mall/Location
Minnesota
Indiana
Merrillville
State/City
Briarwood Mall
Lakeview Square Mall
Fairlane Towne Center
Genesee Valley Center
River Town Crossings
Woodland Shopping Center
Eastland Center
The Crossroads
Lansing Mall
Meridian Mall
Twelve Oaks Mall
Birchwood Mall
Fashion Square Mall
Northland Shopping Center
Lakeside Mall
Lakeside Mall Home
Southland Center
Grand Traverse Mall
Oakland Mall
Somerset Collection
Summit Place Mall
Westland Center
1974
1983
1976
1970
1999
1975
1957
1980
1979
1982
1977
1997
1976
1954
1978
1978
1970
1992
1968
1996
1962
1965
189
102
241
266
171
161
433
122
103
154
244
103
123
505
207
119
283
103
442
314
284
334
South Dakota
Sioux Falls
Wisconsin
Appleton
Eau Claire
La Crosse
Madison
Wauwatosa
New Store Openings
Bolingbrook, IL
Division Review
Macy’s Northwest
Third Avenue and Pine Street | Seattle, WA 98181 | 206-344-2121
*as of 3/3/07
Seattle-based Macy’s Northwest (formerly The Bon Marché) has
grown to encompass Meier & Frank stores in Oregon, Washington
and Utah – all of which were converted to Macy’s in September
2006. In all, this division operates 68 stores. Macy’s Northwest is
clearly the retail leader in the Pacific Northwest, with a track
record of serving major metropolitan areas and local communities
with stores tailored to their needs.
Jeffrey Gennette
Chairman
Robert B. Harrison
President
Macy’s Northwest operates stores in six states. Some Macy’s
stores offer a full line of both fashion apparel and home
merchandise. Others are dedicated furniture/home stores or
smaller locations without furniture departments.
Macy’s Northwest is led by Chairman Jeffrey Gennette and
President Robert B. ”R.B.” Harrison.
Gennette was named chairman in December 2005, after
serving as executive vice president and director of stores for
Macy’s Central since 2004. Previously, he served as senior vice
president/general merchandise manager at Macy’s West since
2001. Gennette joined Macy’s West in 1983 as an executive trainee
and also has served with FAO Schwarz and Broadway Stores.
Harrison was named president in December 2005, after serving
as chairman of Robinsons-May since 2004, and senior vice
president and chief financial officer since 2002. Previously, he
served as senior vice president for finance at Meier & Frank.
Harrison began his career at Kaufmann’s in 1986 and became
vice president and controller.
Idaho
Montana
Oregon
Utah
Washington
Wyoming
“Outstanding every time I come to shop. We had a great time shopping today.
Great sales and great service.” – Jennie F., Roseburg, OR
Macy’s Northwest
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Boise Town Square
Downtown
Coeur D’Alene
Grand Teton Mall
Lewiston Center Mall
Palouse Empire Mall
Karcher Mall
Magic Valley Mall
1988
1937
2002
1984
1978
1979
1973
1987
180
118
44
60
44
41
60
61
Main Mall
The Northside Center
Downtown
1980
2001
1865
51
65
113
Bend River Mall
Pony Village Mall
Valley River Mall
The Streets at Tanasbourne
Rogue Valley Mall
Rogue Valley Mall Home
Clackamas Town Center
Clackamas Town Center Home
Lloyd Center
Garden Valley Mall
Lancaster Mall
Salem Centre
Washington Square
1980
1980
1990
2004
1986
1986
1980
1980
1966
1980
1980
1966
1973
103
41
192
172
111
45
199
122
298
40
67
189
269
Cottonwood Mall
Fashion Place Mall
Layton Hills Mall
The Family Center at Riverdale
Downtown
South Towne Center
University Mall
Valley Fair Mall
1962
1988
1980
2003
1868
1986
1972
1970
237
26
162
140
304
203
208
106
Idaho
Boise
Boise
Coeur D’ Alene
Idaho Falls
Lewiston
Moscow
Nampa
Twin Falls
Oregon
Bend
Coos Bay
Eugene
Hillsboro
Medford
Medford
Portland
Portland
Portland
Roseburg
Salem
Salem
Tigard
Utah
Salt Lake City
Murray
Layton
Riverdale
Salt Lake City
Sandy
Orem
West Valley City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Bellevue Square Home
Bellevue Square Mall
Bellingham Furniture Gallery
Bellis Fair Mall
Cascade Mall
Cascade Mall Home
Everett Mall
SeaTac Mall
Three Rivers Mall
Columbia Center Mall
Columbia Center Mall
Kennewick Furniture Gallery
Alderwood Furniture Gallery
Alderwood Mall
Capital Mall
Olympia Furniture Gallery
South Hill Mall
Redmond Town Center
Redmond Furniture Gallery
Downtown Flagship
Northgate Mall
Southcenter Mall
Kitsap Mall
Silverdale Furniture Gallery
Downtown
East Valley Mall
Northtown
Tacoma Furniture Gallery
Tacoma Mall
Budget House (clearance)
Tukwila Furniture Gallery
Vancouver Mall
Walla Falls
Wenatchee Valley Mall
Valley Mall
1984
1984
1991
1988
1989
2004
1977
1977
1987
1969
2002
2004
1985
1979
1978
1996
1994
2003
1987
1929
1950
1968
1985
1995
1947
1997
1993
2003
1964
1974
1981
1977
1944
2001
2002
51
179
40
120
62
51
133
141
51
122
40
40
40
221
111
40
114
111
40
861
319
265
120
40
357
122
106
53
257
33
49
180
69
87
119
East Ridge Mall
1983
61
2007
275
Washington
Montana
Bozeman
Helena
Missoula
State/City
Bellevue
Bellevue
Bellingham
Bellingham
Burlington
Burlington
Everett
Federal Way
Kelso/ Longview
Kennewick
Kennewick
Kennewick
Lynnwood
Lynnwood
Olympia
Olympia
Puyallup
Redmond
Redmond
Seattle
Seattle
Seattle
Silverdale
Silverdale
Spokane
Spokane
Spokane
Tacoma
Tacoma
Tukwila
Tukwila
Vancouver
Walla Walla
Wenatchee
Yakima
Wyoming
Casper
Store Reopening
Portland Downtown
Division Review
Macy’s South
223 Perimeter Center Parkway | Atlanta, GA 30346 | 770-913-4000
*as of 3/3/07
Macy’s South, based in Atlanta, encompasses most of the former
Macy’s Central division, as well as certain Foley’s, Hecht’s and
Famous-Barr stores acquired from May Company and converted
to Macy’s in September 2006. Following a systems conversion in
2007, Macy’s South operates more than 130 stores, some of the
most prominent and exciting locations in the region.
Edwin J. Holman
Chairman
Andrew P. Pickman
President
Michael G. Krauter
Vice Chairman &
Director of Stores
Macy’s South operations have grown over time through a
series of acquisitions and consolidations among family-owned
retailers, bringing together Rich’s and Macy’s from Atlanta,
Goldsmith’s from Memphis, and Foley’s from Houston. Macy’s
South stores are recognized for popular merchandise, good
customer service and close ties to the communities where they
do business.
Macy’s South operates under the direction of Chairman Edwin J.
Holman, President Andrew P. “Drew” Pickman and Vice Chairman
and Director of Stores Michael G. Krauter.
Holman re-joined the division in January 2005 after serving as
chairman and chief executive officer of Galyan’s Trading Company,
Inc. Prior to that, Holman served as president of Bloomingdale’s
from June 2000 to September 2003. He was president and chief
operating officer of Rich’s/Lazarus/Goldsmith’s (now Macy’s South)
from January 1999 to June 2000.
Alabama
Georgia
Kentucky
Louisiana
North Carolina
Oklahoma
South Carolina
Tennessee
Texas
Virginia
Pickman was named president in December 2005, after serving
as president of Foley’s since 2002. Previously, he was president of
Kaufmann’s and senior vice president and general merchandise
manager at May Merchandising Company. Pickman joined Filene’s
in 1975 when it was a division of Federated, and rose to become
senior vice president and general merchandise manager at
Filene’s/Kaufmann’s.
Krauter was named vice chairman and director of stores in
December 2005, after serving as president of Macy’s Central since
2004, and executive vice president and director of stores since
2001. Previously, Krauter served as Macy’s South-Bullock's vice
president, Macy’s East senior vice president of merchandising
and Macy’s West executive vice president for merchandising.
“I love this store! Everyone is so friendly. The store is very open and easy to shop.
I always find lots of items at good prices.” – Bev T., Greensboro, NC
Macy’s South
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Brookwood Village
Riverchase Galleria
1974
1986
244
226
Georgia Square Mall
Cumberland Mall
Greenbriar
Lenox Square
Mall of Georgia
North Point Furniture Gallery
North Point Mall
Northlake
Perimeter Furniture Gallery
Perimeter Mall
The Mall at Stonecrest
Augusta Mall
Peachtree Mall
North Dekalb
South Dekalb
Arbor Place Mall
Gwinnett Furniture Gallery
Gwinnett Place Mall
Town Center at Cobb
Town Center Furniture Gallery
Macon
Southlake
Oglethorpe Mall
Shannon Mall
1981
1973
1965
1959
2000
2000
1993
1971
1986
1971
2001
1978
2002
1965
1969
2004
1998
1984
1986
2003
1975
1976
1992
1980
121
280
200
433
245
71
250
192
87
280
160
166
139
190
188
141
51
245
255
243
158
233
143
130
Greenwood Mall
Fayette Mall
Jefferson Mall
Oxmoor Center
1980
1971
1979
1970
124
279
157
278
Cortana Mall
Mall of Louisiana
Acadiana Mall
Prien Lake Mall
1976
1997
1979
2003
243
220
186
116
Alabama
Birmingham
Birmingham
Kentucky
Bowling Green
Lexington
Louisville
Louisville
Louisiana
Baton Rouge
Baton Rouge
Lafayette
Lake Charles
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Cary Towne Center
Northlake Mall
Southpark Mall
Northgate Mall
The Streets at South Point
Cross Creek Mall
Friendly Center
Wendover Place
Carolina Place
Crabtree Valley Mall
Triangle Town Center
Hanes Mall
1991
2005
1988
1994
2001
1975
1958
2002
1993
1995
2002
1990
107
167
201
187
180
134
147
141
151
175
180
155
Crossroads Mall
Penn Square Mall
Quail Springs Mall
Tulsa Promenade
Woodland Hills
1986
1988
1986
1996
1982
153
161
146
180
160
Columbia Mall
Haywood Mall
1978
1980
186
152
Cool Springs Galleria
Old Hickory
Hickory Ridge
Oak Court
Southland Mall
Wolfchase Galleria
Bellevue Center
Hickory Hollow
Mall at Green Hills
Rivergate Mall
1991
1981
1981
1961
1966
1997
1990
1979
2004
1971
270
160
226
399
150
266
168
181
179
204
North Carolina
Georgia
Athens
Atlanta
Atlanta
Atlanta
Atlanta
Atlanta
Atlanta
Atlanta
Atlanta
Atlanta
Atlanta
Augusta
Columbus
Decatur
Decatur
Douglasville
Duluth
Duluth
Kennesaw
Kennesaw
Macon
Morrow
Savannah
Union City
State/City
Cary
Charlotte
Charlotte
Durham
Durham
Fayetteville
Greensboro
Greensboro
Pineville
Raleigh
Raleigh
Winston–Salem
Oklahoma
Oklahoma City
Oklahoma City
Oklahoma City
Tulsa
Tulsa
South Carolina
Columbia
Greenville
Tennessee
Franklin
Jackson
Memphis
Memphis
Memphis
Memphis
Nashville
Nashville
Nashville
Nashville
Division Review
Macy’s South
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Parks at Arlington
Barton Creek Square Mall
Highland Mall
San Jacinto Mall
Parkdale Mall
Lakeline Mall
Post Oak Mall
Padre Staples Mall
Dallas Galleria
North Park Center
Southwest Center Mall
Valley View
Golden Triangle
Stonebriar Center
Hulen Mall
Ridgmar Mall
Firewheel Towncenter
Almeda Mall
Baybrook Mall
Downtown
Greenspoint Mall
Houston Galleria
Memorial City Mall
Northwest Mall
Sharpstown Center
The Galleria
The Woodlands Mall
The Woodlands Mall Furniture Gallery
The Woodlands Mall Home
West Oaks Mall
Willowbrook
Willowbrook Home
Deerbrook Mall
Northeast Mall
Irving Mall
Mall Del Norte
Mall Del Norte Home
Vista Ridge Mall
La Plaza Mall
La Plaza Mall Home
Town East
Pasadena Town Square
Collin Creek Mall
The Shops at Willow Bend
Ingram Park Mall
Ingram Park Furniture Gallery
North Star Mall
Rolling Oaks Shopping Center
San Antonio Rivercenter
South Park Mall
First Colony Mall
Temple Mall
Mall of the Mainland
Tyler
1990
1982
1979
1980
2002
1995
1984
1987
1985
2000
1975
1973
2003
2000
1977
1998
2005
1966
2004
1947
1976
1986
2001
1967
1961
2003
1994
2002
2001
1982
1981
2002
1984
2001
1989
1996
1996
1991
1997
1997
1972
1962
1980
2001
1983
1983
1981
1992
1989
2000
2005
1996
1995
1994
1981
201
225
225
157
171
180
105
199
268
250
148
300
114
201
215
181
141
296
244
791
314
256
300
294
308
248
201
18
17
243
248
91
202
240
188
113
33
181
181
50
196
209
199
239
150
59
256
179
96
120
166
202
111
151
100
Texas
Arlington
Austin
Austin
Baytown
Beaumont
Cedar Park
College Station
Corpus Christi
Dallas
Dallas
Dallas
Dallas
Denton
Frisco
Ft. Worth
Ft. Worth
Garland
Houston
Houston
Houston
Houston
Houston
Houston
Houston
Houston
Houston
Houston
Houston
Houston
Houston
Houston
Houston
Humble
Hurst
Irving
Laredo
Laredo
Lewisville
McAllen
McAllen
Mesquite
Pasadena
Plano
Plano
San Antonio
San Antonio
San Antonio
San Antonio
San Antonio
San Antonio
San Antonio
Sugar Land
Temple
Texas City
Tyler
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Chesapeake Square
Greenbrier Mall
Southpark Mall
Virginia Center Commons
Coliseum Mall
River Ridge Mall
Patrick Henry
Military Circle Shopping Center
Chesterfield Towne Center
Regency Square Furniture Gallery
Regency Square –North
Regency Square –South
Short Pump Town Center
Valley View Mall
Valley View Mall Home
Lynnhaven Mall
1999
1990
1989
1993
1977
1980
1998
1976
1990
1990
1990
1990
2003
1985
2001
1998
95
145
104
110
173
144
141
152
143
23
124
100
202
101
47
200
2007
2007
140
130
Virginia
Chesapeake
Chesapeake
Colonial Heights
Glen Allen
Hampton
Lynchburg
Newport News
Norfolk
Richmond
Richmond
Richmond
Richmond
Richmond
Roanoke
Roanoke
Virginia Beach
New Store Openings
Austin, TX
Collierville, TN
always so much fun to shop
“It’s
in Macy’s. The children’s clothes
are always great quality, including
the Greendog brand, which is rare
to find in a store’s own brand.
I always get compliments on my
kids’ clothes when they wear
something from your store, and
it’s so affordable too!
”
– Shannon H., Winder, GA
Division Review
Macy’s West
50 O’Farrell Street | San Francisco, CA 94102 | 415-397-3333
*as of 3/3/07
Macy’s West, headquartered in San Francisco, operates about
190 stores in Arizona, California, Colorado, Guam, Hawaii, Nevada,
New Mexico and Texas. The division incorporates Robinsons-May
and Foley’s stores acquired in the May Company merger and they
converted to the Macy’s nameplate in September 2006. Macy’s
West excels at infusing the glitter of Hollywood and the wizardry
of Silicon Valley into its operations.
Robert L. Mettler
Chairman
Daniel H. Edelman
President
Rudolph J. Borneo
Vice Chairman &
Director of Stores
Macy’s was long-established as a New York retailing powerhouse
when it looked west in 1945 and acquired O’Connor Moffat and
Company in San Francisco as its California beachhead. Two years
later, O’Connor Moffat stores, including the landmark Union
Square location opened in 1866, were converted to Macy’s – and
eventually rolled out into other northern California markets and
other western regions.
In 1988, Macy’s purchased the Bullock’s division of Federated,
which had been founded in 1906 in Los Angeles by John G.
Bullock. Bullock’s stores were converted to the Macy’s nameplate
in 1996.
In 1995, Federated acquired Los Angeles-based Broadway
Stores, Inc., which operated 82 Broadway, Emporium and
Weinstock’s stores in California and four other southwestern
states. Of those acquired stores, more than 50 were converted
to the Macy’s nameplate in 1996.
Arizona
California
Colorado
Hawaii
Nevada
New Mexico
Texas
Guam
“We opened a new Macy’s account.
Shopping in the Mattress and Bedding
departments was such a pleasure.
Nash in mattresses and Patricia in
bedding were so equally knowledgeable
and helpful. It was one stop shopping
at its very best and most efficient. There
was a great selection of items in both
departments.” – Irene S., Santa Clara, CA
In 2001, following Federated’s acquisition of Liberty House,
12 department stores in Hawaii and Guam, as well as seven resort
and specialty stores, were added to Macy’s West and converted
to the Macy’s nameplate.
Macy’s West is headed by Chairman Robert L. Mettler, President
Daniel H. Edelman, and Vice Chairman and Director of Stores
Rudolph J. Borneo.
Mettler became chairman of Macy’s West in 2002 after three
years as the division’s president. Previously, he served as Sears,
Roebuck & Co.’s president of merchandising for all full-line stores.
Mettler is a 30-year retailing veteran who has served as president
and CEO of J.W. Robinson’s in Los Angeles, as well as in various
positions with Allied Stores Corporation and May Company.
Edelman was named president in December 2005, after serving
as chairman of Macy’s Northwest since 1998, and as president of
the division since 1997. Previously, he was vice chairman for
finance and operations at Macy’s West and began his career in
1976 with Macy’s in New York.
Borneo, a career Macy’s executive, has been vice chairman
of Macy’s West since 1992 and had been president of Macy’s
South/Bullock’s for the four previous years. He joined the
company in 1964.
Macy’s West
State/City
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Fashion Center
Arrowhead Towne Center
Fiesta Mall
Superstition Springs Center
Biltmore Fashion Park
Metro Center
Paradise Valley
Scottsdale
El Con Center
Park Mall
Tucson Mall
2001
1993
1979
1994
1968
1973
1980
2002
1969
1974
1991
201
200
159
155
213
107
153
251
301
153
146
Mission Viejo Mall
Mission Viejo Mall
County East Mall
Santa Anita Fashion
Valley Plaza
Brea
Burbank
Topanga Plaza
Carlsbad
Plaza Camino Real
Los Cerritos Center
Chula Vista Center
Otay Ranch
Sunrise
Sunrise
Puente Hills Mall
Sun Valley Mall
Sun Valley Mall Home
The Village at Corte Madera
Crystal Court Home
South Coast Plaza
South Coast Plaza
Fox Hills
Vallco Fashion Park
Serramonte
Imperial Valley
North County Fair
Solano Mall
Fresno
Fresno
Fresno Furniture Gallery
Glendale Galleria
Southland Mall
Grossmont Shopping Center
Laguna Hills
Lakewood
Baldwin Hills Crenshaw Plaza
Beverly Center
Beverly Center
Broadway Plaza
Century City
Citicorp Plaza
Del Amo Fashion Center
Eagle Rock
Irvine Spectrum Center
Laurel Plaza
1979
1980
2004
1974
1967
1996
1992
1994
1980
1979
1971
1962
2006
1972
1972
1974
1967
1981
1985
1996
1973
1973
1975
1997
1968
2005
1986
1985
1970
1983
2000
1996
1983
1961
1975
1952
1947
1982
1982
1973
1976
1986
1981
1973
2002
1955
237
197
107
188
150
185
278
243
118
156
175
181
140
160
178
153
206
183
129
209
276
79
189
177
233
140
151
165
76
187
73
191
179
151
157
348
257
158
67
266
136
135
177
150
140
475
Arizona
Chandler
Glendale
Mesa
Mesa
Phoenix
Phoenix
Phoenix
Scottsdale
Tucson
Tucson
Tucson
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
1998
1990
1990
1965
2004
1982
1982
1977
1981
1968
2001
1967
1997
1992
1995
1980
1967
1992
1982
1983
1961
1961
1947
1980
1994
1980
1980
2004
2004
2001
1959
1976
1973
2000
2001
1961
1961
1979
1963
1972
1998
1969
1985
1977
1961
1975
1972
1981
1952
1977
1866
1866
1971
1978
1957
1954
1987
1964
1958
75
154
34
243
51
111
67
87
146
171
89
237
39
197
215
196
226
50
200
22
223
96
301
158
48
197
174
182
175
106
361
201
150
184
50
204
165
201
338
177
181
204
139
155
385
185
120
156
280
63
929
248
187
236
213
252
35
266
334
California (continued)
California
Anaheim
Anaheim
Antioch
Arcadia
Bakersfield
Brea
Burbank
Canoga Park
Carlsbad
Carlsbad
Cerritos
Chula Vista
Chula Vista
Citrus Heights
Citrus Heights
City of Industry
Concord
Concord
Corte Madera
Costa Mesa
Costa Mesa
Costa Mesa
Culver City
Cupertino
Daly City
El Centro
Escondido
Fairfield
Fresno
Fresno
Fresno
Glendale
Hayward
La Mesa
Laguna Hills
Lakewood
Los Angeles
Los Angeles
Los Angeles
Los Angeles
Los Angeles
Los Angeles
Los Angeles
Los Angeles
Los Angeles
Los Angeles
State/City
Los Angeles
Los Angeles
Los Angeles
Los Angeles
Los Angeles
Manhattan Beach
Manhattan Beach
Modesto
Modesto
Montclair
Montebello
Monterey
Monterey
Moreno Valley
Northridge
Newpark
Newport Beach
Novato
Palm Desert
Palm Desert
Palo Alto
Palo Alto
Pasadena
Pasadena
Pleasanton
Pleasanton
Pleasanton
Rancho Cucamonga
Rancho Cucamonga
Redding
Redondo Beach
Richmond
Riverside
Roseville
Roseville
Sacramento
Sacramento
Sacramento
Sacramento
Salinas
San Bernardino
San Diego
San Diego
San Diego
San Diego
San Diego
San Diego
San Diego
San Francisco
San Francisco
San Francisco
San Francisco
San José
San José
San Leandro
San Mateo
San Mateo
San Rafael
Santa Ana
Mission Road
Stonewood Shopping Center
Stonewood Shopping Center Home
West Pavilion Mall
West Pavilion Mall Furniture Gallery
Manhattan Beach
Manhattan Beach
Vintage Fair
Vintage Fair
Montclair Plaza
Montebello Town Center
Del Monte Center
Monterey Furniture Gallery
Moreno Valley Mall at Towngate
Northridge
Newpark
Newport Beach
Novato Furniture Gallery
Palm Desert
Palm Desert Furniture Gallery
Stanford
Stanford
Pasadena
Pasadena Plaza
Pleasanton Furniture Gallery
Stoneridge
Stoneridge
Mt. Shasta Mall
Galleria at South Bay
Hilltop
Galleria at Tyler
Roseville Mall
The Ridge at Creekside Furniture Gallery
Arden Fair
Country Club Plaza
Downtown Plaza
Sacramento
Northridge Center
Inland Center
Fashion Valley Center
Horton Plaza
La Jolla
Mission Valley
Mission Valley Home
Parkway
Plaza Bonita
Stonestown
Union City (clearance)
Union Square
Union Square
Eastridge
Oakridge
Bay Fair
Hillsdale
Hillsdale Furniture Gallery
Northgate Mall – Marin
Santa Ana
Macy’s West
State/City
Year
Opened
Gross Sq. Ft.
(in 000s)
Santa Ana Furniture and Clearance
La Cumbre Plaza
Paseo Nuevo
Valley Fair
Valley Fair
Valencia Town Center
Capitola Mall
Santa Maria Town Center
Santa Monica Place
Coddingtown Regional
Santa Rosa
Sherman Oaks
Simi Valley Town Center
Simi Valley Town Center
Stockton
Sunnyvale
The Promenade in Temecula
Promenade Mall
The Oaks
The Oaks
Del Amo
Del Amo Home
Buena Ventura Plaza
Broadway Plaza
Broadway Plaza
West Covina
West Covina
Westminster Mall
Promenade
Promenade
2006
1967
1990
1956
1957
1992
2002
1990
1990
1966
1981
1962
2006
2005
1966
1979
1999
2002
1983
1983
1966
1966
1963
1954
1995
1993
1975
1974
1993
1993
154
150
141
396
316
146
102
131
155
203
187
312
70
107
168
178
208
165
137
149
289
165
181
188
72
150
150
219
192
81
Town Center at Aurora
Crossroads
Flat Iron Crossing
Chapel Hills
The Citadel
Cherry Creek
Cherry Creek Furniture Gallery
Northfield Center
Foothills Fashion Mall
Park Meadows
Southglenn Shopping Center
Southwest Plaza Mall
Promenade Shops at Centerra
Westminster Mall
1975
1983
2000
1998
1984
1990
1990
2006
1974
1997
1974
1982
2005
1986
167
153
205
174
195
189
21
140
129
217
191
141
150
156
Mall/Location
California (continued)
Santa Ana
Santa Barbara
Santa Barbara
Santa Clara
Santa Clara
Santa Clarita
Santa Cruz
Santa Maria
Santa Monica
Santa Rosa
Santa Rosa
Sherman Oaks
Simi Valley
Simi Valley
Stockton
Sunnyvale
Temecula
Temecula
Thousand Oaks
Thousand Oaks
Torrance
Torrance
Ventura
Walnut Creek
Walnut Creek
West Covina
West Covina
Westminster
Woodland Hills
Woodland Hills
Mall/Location
Year
Opened
Gross Sq. Ft.
(in 000s)
Pearlridge
Prince Kuhio Plaza
Prince Kuhio Plaza
Ala Moana
Ala Moana Jewel Gallery (specialty)
Downtown Honolulu
Kahala
Kahala
Waikiki
Hyatt Regency (specialty)
Queen Kaahumanu Center
Queen Kaahumanu Center
Kailua
Makalapua
Windward Mall
Mauna Lani Bay (specialty)
Kukui Grove
Kukui Grove
King’s Shops (specialty)
1971
1985
2003
1966
1986
1850
1958
1958
1937
1983
1972
2003
1946
1997
1982
1983
1992
2003
1992
166
50
62
325
2
80
94
15
39
7
80
86
59
52
87
3
50
25
4
Galleria at Sunset Mall
The Fashion Show
The Fashion Show
Boulevard
Las Vegas Home
Meadows
Reno
Reno
Reno Furniture Gallery
1996
1981
1981
1966
1994
1978
1978
1979
1994
229
207
201
178
111
165
167
102
52
Coronado Center
Cottonwood Mall
1976
1996
157
173
Sunland Park Mall
Cielo Vista Mall
2004
2002
105
187
Micronesia
1994
88
2007
20
Hawaii
Aiae (Oahu)
Hilo (Hawaii)
Hilo (Hawaii)
Honolulu (Oahu)
Honolulu (Oahu)
Honolulu (Oahu)
Honolulu (Oahu)
Honolulu (Oahu)
Honolulu (Oahu)
Kaanapali (Maui)
Kahului (Maui)
Kahului (Maui)
Kailua (Oahu)
Kailua–Kona (Hawaii)
Kaneohe (Oahu)
Kohala Coast (Hawaii)
Lihue (Kauai)
Lihue (Kauai)
Waikoloa (Hawaii)
Nevada
Las Vegas
Las Vegas
Las Vegas
Las Vegas
Las Vegas
Las Vegas
Reno
Reno
Reno
New Mexico
Colorado
Aurora
Boulder
Broomfield
Colorado Springs
Colorado Springs
Denver
Denver
Denver
Fort Collins
Littleton
Littleton
Littleton
Loveland
Westminster
State/City
Albuquerque
Albuquerque
Texas
El Paso
El Paso
Guam
Dededo
New Store Openings
Littleton, CO (Replacement Furniture Gallery)
in the men’s department was
“Phillip
awesome! He helped us exchange ties
and my husband was very pleased with
his professionalism. He was polite and
very, very patient and courteous.
Thank you, Phillip.
”
– Vanna R., Vail, AZ
Division Review
macys.com
1440 Broadway | New York, NY 10018
Peter Sachse
Chairman
Macys.com, operating from offices in New York and San Francisco,
is one of the fastest-growing sales vehicles for Federated. It is part
of Federated’s direct-to-consumer business, which generated
sales of about $620 million in 2006 and is expected to exceed
$1 billion in sales in 2008. (Direct-to-consumer includes
macys.com, bloomingdales.com, Bloomingdale’s By Mail, national
online wedding gift registries, and fulfillment of telephone
orders).
Macys.com is far more than a selling site. It is an online hub for
the Macy’s brand. Shoppers come to buy merchandise, but also to
check their account, pay bills, find store locations, view catalogs,
see TV ads, apply for a job and get information on store events,
just to name a few.
The site provides an important online presence and e-mail
outreach for events like the brand launch, the Macy’s
Thanksgiving Day Parade and the Go Red for Women initiative.
Customers can get to know the Macy’s Culinary Council through
online profiles, access recipes and watch a video on how the
Council works together. And visitors to macys.com can get the
full story of our “Path to Peace” project related to the sale of
baskets woven by widows of the Rwandan genocide.
Macys.com today attracts about 750,000 visits every day – about
280 million visits per year. In 2007, macys.com expects to ship
more than 4 million orders.
Macys.com carries more than 38,000 items (some 170,000 SKUs),
which is less than an average store assortment. But in home
merchandise, macys.com actually carries more products online
than a typical Macy’s store.
“This has been one of the better online shopping
experiences I have ever had. It was user
friendly; easy to navigate and find the clothing
items I was looking for. You have a new
customer for sure!” – Carl T., Accokeek, MD
The site continues to add new vendors, as well as new product
categories. Mattresses launched in January 2007. Maternity went
live in April 2007. A fashion sunglasses boutique is expected to
launch in May 2007, with furniture planned for July 2007. The
biggest new launch of all – the Martha Stewart Collection online –
will be coming in fall 2007.
In 2007, Federated opened a dedicated 600,000-square-foot
distribution center near Portland, TN, to support its direct-toconsumer businesses. A distribution center of similar size and
scope will open in spring 2008 in Goodyear, AZ.
Macys.com is staffed with an organization of more than 350
associates, including a team of 90 merchants who specialize in
planning and buying Macy’s online assortment.
Macys.com is led by Chairman and CEO Peter Sachse, who
joined the organization in March 2006 after serving as president
of the Macy’s Corporate Marketing division since June 2003.
Previously, he was president and chief operating officer of the
company’s The Bon Marché division (now Macy’s Northwest).
Sachse began his retail career with Macy’s in Kansas City in 1980.
Division Review
Support Operations
Macy’s Home Store (MCH)
Federated Logistics and
Operations (FLO)
Federated Systems Group (FSG)
Financial, Administrative and
Credit Services (FACS) Group
Macy’s Corporate Marketing (MCM)
Macy’s Merchandising Group (MMG)
Division Review
Macy’s Home Store (MCH)
1120 Avenue of the Americas | New York, NY 10036 | 646-429-4000
Timothy M. Adams
Chairman
Michael J. Osborn
President
Federated formed the Macy’s Home
Store (MCH) division early in 2004 to
extend its leadership in home fashion.
This New York-based division is
responsible for the overall strategy,
product development, merchandising
and marketing of home-related
merchandise in Macy’s stores. This
includes design, planning and
marketing for textiles, tabletop,
housewares and furniture.
Macy’s Home Store was created to
accelerate sales by improving and
further differentiating the company’s
home assortments. A more coordinated,
centralized approach to home buying,
merchandising and marketing enables
the company to work more effectively
with vendors to better edit assortments,
secure unique product and introduce
newness that will excite customers and
further distinguish our offerings.
Macy’s Home Store builds on what
already is a core business. The customer
already looks to Macy’s as a favored
place to shop for her home needs. The
company’s national and international
Jeffrey A. Kantor
vendor base, combined with its highPresident, Furniture
quality private brands for the home –
Charter Club, Hotel Collection, The Cellar
and Tools of the Trade – provide a strong foundation on
which to build this part of our business, making it bigger
and better than ever before.
In addition, Macy’s Home Store will feature the new
Martha Stewart Collection when it launches in fall 2007.
This all-new brand, developed exclusively for Macy’s, will
encompass an array of home goods for entertaining,
cooking and holiday decorating.
Macy’s Home Store is led by Chairman Timothy M. Adams,
President Michael J. Osborn and President for Furniture
Jeffrey A. Kantor.
Adams joined Macy’s Home Store as chairman in July
2005 after serving as chairman of the Macy’s Florida division
since April 2001. For the previous five years, he was
president of the former Bon Marché (now Macy’s Northwest)
division, based in Seattle, WA. Adams began his retail career
at Macy’s in Atlanta in 1976.
Osborn joined Macy’s Home Store in August 2005 after
serving since June 2002 as president of Macy’s West in San
Francisco. Previously, he served for eight years as president
of Miami-based Burdines (now Macy’s Florida). Osborn
began his career at Bullock’s, then a Los-Angeles based
division of Federated, in 1974.
Kantor joined Macy’s Home Store in February 2006 after
serving as president and chief executive officer at
Hecht’s/Strawbridge’s since 2004. Previously he served as
senior vice president/general merchandise manager at
Filene’s. Kantor began his career at Filene’s in 1981, when
it was a division of Federated.
7 West Seventh Street | Cincinnati, OH 45202 |
513-579-7000
Federated’s Cincinnati corporate office is home to an
organization of professional managers and staff specialists
that provides a wide range of services to the total
corporation, including divisions and support operations
nationwide. Support services and counsel to company
operations include tax, audit, accounting, cash management
and finance, planning, insurance, statistical analysis and
forecasting, law, communications and real estate. In addition,
the Cincinnati-based corporate office houses the company’s
consolidated divisional accounting function. Diversity,
employee training and vendor development programs,
along with the Federated Department Stores Foundation,
also are managed at Federated’s Cincinnati corporate office.
In addition, the company maintains corporate offices in
New York City.
Federated Logistics and
Operations (FLO)
500 Meadowlands Parkway | Secaucus, NJ 07094 |
201-422-7300
Founded in 1994, Federated Logistics and
Operations (FLO) performs a wide range of
logistics, distribution and operations functions
for all Macy’s and Bloomingdale’s retail
divisions.
The primary responsibility of FLO is to ensure
the efficient and timely flow of fresh goods to
the selling floor of the company’s stores –
Peter Longo
delivering the right merchandise to the right
President
Federated Logistics
locations at the right time. To this end, the
division operates small-ticket and large-ticket
distribution centers, coordinates transportation and shuttle
deliveries, and handles vendor returns and merchandise liquidation.
FLO also delivers merchandise, primarily furniture and other
large-ticket items, to customers’ homes and fulfills Internet and
catalog orders.
To support these initiatives, FLO is aggressive in identifying and
implementing logistics systems and new technology, as well as
working with vendors to maintain high standards for the company’s
supply chain.
The division strives for continuous improvement in people,
processes and technology to reduce supply chain and logistics
costs, while simultaneously working to enhance service, speed
and accuracy.
In 2001, FLO was among the first operations in the retailing
business to adopt Six Sigma quality improvement techniques to
create and drive a focused culture, expand operating capabilities
and improve processes.
A leader in EDI (electronic data interchange) with vendors,
FLO maintains state-of-the-art material handling systems in its
distribution centers. It is considered a current leader in pursuing
the benefits of RFID (radio frequency identification) technology
to help speed the flow of goods through distribution centers
and other facilities.
In spring 2007, Federated opened a new 600,000-square-foot
distribution center near Portland, TN, dedicated to handling orders
for the company’s fast-growing direct-to-consumer businesses
such as macys.com and bloomingdales.com. The distribution center
will specialize in efficiently and quickly filling single orders placed
by customers via Internet, catalog and telephone. It is part of a
$230 million capital investment in 2006-2008 for infrastructure
and service improvement for these direct-to-consumer channels.
Another distribution center is scheduled to open in 2008 in
Goodyear, AZ.
Federated Logistics is headed by President Peter Longo. Longo
was named president in January 2000 after serving as the division's
executive vice president. He is a Federated veteran who first joined
the company in 1973 at Bloomingdale’s.
Division Review
Federated Systems Group (FSG)
5985 State Bridge Road | Duluth, GA 30097 |
678-474-2000
Federated Systems Group (FSG) provides
an integrated line of high-performance
retail, electronic commerce and data
warehouse systems for use at all levels
within Federated. FSG uses a mix of
Internet, wireless, client/server, midrange
and mainframe technologies to meet
Federated’s business needs. FSG
Larry A. Lewark
management works closely with
President & Chief
department store divisions, the corporate
Information Officer
office and merchandise vendors to
identify new opportunities and ensure
that the company’s systems can adapt to changing
business conditions.
FSG’s role is to support the four
priorities of the company:
• Assortments: FSG continues to maximize and improve
its merchant systems and data warehouse in order to
provide the merchants with current analytical data for
decision making.
• Price Simplification: FSG provides customer service
devices (price and gift card value checking) and other
new technologies as they emerge.
• In-Store Experience: New technology on the sales floor
is helping process transactions more quickly, accurately
and efficiently, leading to an improved experience for
the customer.
• Marketing: New systems in the marketing area will
provide data to maximize and focus marketing more
appropriately. Additionally, FSG systems increase the
efficiency of production workflow in corporate and
divisional marketing departments.
Larry Lewark leads FSG. A career executive with Federated,
Lewark was named the company’s chief information officer
in 2001 and has been FSG’s president since 1997. Previously,
he was senior vice president for credit and systems at the
company’s Financial, Administrative and Credit Services
(FACS) Group division. Lewark began his career at Federated
in 1970 and has served in a variety of buying, store
management, data processing and technology positions.
Financial, Administrative and Credit Services (FACS) Group
9111 Duke Boulevard | Mason, OH 45040 | 513-398-5221
Financial, Administrative and Credit
Services (FACS) Group, Federated’s credit
services division, was founded in 1989. It
services all Bloomingdale’s and Macy’s
proprietary and VISA credit card accounts.
In addition, FACS performs most
other non-store services for customers
and employees, including telephone
Mike Gatio
President
orders for the retail divisions and
Bloomingdale’s By Mail, furniture/
bedding customer service, e-commerce support (e-mails,
telephone calls) for macys.com, bloomingdales.com and
Wedding Channel bridal businesses, human resources
services, payroll and benefits.
FACS has played an important role in improving the
shopping experience at Federated stores through a
redesign of its customer services, streamlining the POS
process for credit customers, and enhancing monthly
account statements.
Proprietary credit is an important service offered to
Federated customers, and more than 44 percent of customer
purchases are through the use of these credit cards. Each
business day, Federated collects, organizes and analyzes
millions of customer transactions. This data helps managers
run the business and provides a tool for Federated to market
more efficiently to targeted customer segments.
More than 5.2 million new proprietary charge accounts
were opened for Bloomingdale’s and Macy’s customers last
year. In all, more than 24 million customers used their
Bloomingdale’s or Macy’s credit cards in 2006. Beginning
in February 2006, May Company stores were able to
accept Macy’s credit cards, and in July 2006, FACS issued
15 million Macy’s credit cards to all eligible May Company
credit card holders.
Federated, through FACS, maintains Macy’s Star Rewards
and Bloomingdale’s Rewards
Plus loyalty programs to
support sales growth at
Federated’s department
store divisions. Frequent
buyers earn rewards every time they use one of Federated’s
proprietary credit cards. Former May Company stores were
able to open Macy’s Star Rewards accounts for customers
beginning in July 2006.
FACS’ primary operation is located in suburban Cincinnati,
with satellite facilities in Clearwater, FL; St. Louis, MO; and
Tempe, AZ. FACS provides credit services, such as credit
authorizations, new account development and processing,
customer service and collections for FDS Bank. It also
provides telemarketing and mail and phone order processing
services for Federated’s retail department store divisions.
FACS is led by President Mike Gatio. He was named
president in July 2006, after serving as executive vice
president of credit and marketing since September 2005 and
senior vice president of credit operations since August 2000.
He joined the company in June 1989, and held positions of
increasing responsibilities in authorizations before being
named vice president for credit granting in 1994.
Macy’s Corporate Marketing (MCM)
151 West 34th Street | New York, NY 10001 | 212-494-3412
Macy’s Corporate Marketing (MCM) was
established in May 2003 to direct overall
activity on initiatives implemented to
support the company’s focus on
Marketing (one of Macy’s four strategic
priorities). MCM is responsible for
driving the development of distinctive
sales promotion programs for the Macy’s
Anne MacDonald
brand
that are national in scope but
President &
remain locally responsive. MCM also
Chief Marketing Officer
helps to manage national public
relations and annual events, credit marketing, and causerelated marketing initiatives for the Macy’s brand.
Through compelling advertising, unique visual
merchandising and iconic special events, MCM’s integrated
marketing programs are designed to move the Macy’s
nameplates into a “Category of One,” a position of privilege
no other retailer can own.
MCM works with the divisional marketing teams and
Macy’s national advertising agencies to create and
implement a nationwide strategy
that features unique offerings, value
and in-store shopping experiences
targeted to core customer lifestyles.
Through MCM’s leadership, a
consistent message is communicated by speaking with a common
voice across divisions and
leveraging combined resources.
This allows Federated to build
the Macy’s brand while maximizing the return on its
significant investment in marketing.
MCM is led by President and Chief Marketing Officer
Anne MacDonald. She joined the division in March 2006
from Citigroup where she served as chief marketing officer
for Citi's Global Consumer Group. Previously, MacDonald
was vice president for brand management at Pizza Hut,
a division of PepsiCo, and executive vice president and
managing director at N.W. Ayer, Inc., assigned to its
Procter & Gamble business.
Division Review
Macy’s Merchandising Group (MMG)
11 Penn Plaza | New York, NY 10001 | 646-429-6000
Janet E. Grove
Chairman
Macy’s Merchandising Group (MMG) is
responsible for conceptualizing,
designing, sourcing, and marketing
private label and private branded goods
sold at Macy’s and, in some cases, at
Bloomingdale’s. Some of our highly
successful private brands are I·N·C,
Charter Club/Club Room, Alfani, Style
& Co., Tasso Elba, Tools of the Trade,
Hotel Collection, The Cellar, Greendog
and First Impressions.
In-house design and production
teams work with product developers
to identify trends in the marketplace.
MMG identifies the best source for each
product to bring definitive value at
competitive retail prices to Federated’s
Leonard Marcus
customers with the support of 500
President
associates in offices in 14 nations.
Private brand sales are driven through
aggressive and innovative marketing and sales promotion
programs. MMG’s private brand merchandise represents
about 18.2 percent of total Macy’s sales – amounting to
about $3.4 billion a year at retail.
MMG also is charged with managing core vendor
relationships in the domestic branded market. MMG
works with national brands – such as Polo/Ralph Lauren,
Kenneth Cole, DKNY, Jones New York, Liz Claiborne, Nine
West, Tommy Hilfiger, and Estee Lauder – to strategically
guide the Macy’s divisions in buying product assortments
for stores across the country. Additionally, MMG identifies
product from these brands that will be exclusive to
Macy’s stores.
Janet E. Grove and Leonard Marcus head MMG. Grove,
who also serves as corporate vice chair of Federated, was
named chairman and CEO of Federated Merchandising
Group (predecessor of MMG) in February 1998. She
previously served as executive vice president for center
core, cosmetics and home merchandise. She added the
title of chief executive officer in December 1999. Previously,
she was executive vice president for ready-to-wear and
center core. Grove joined FMG in January 1996 as a senior
vice president from Broadway Stores, Inc., where she was
executive vice president for home merchandise and center
core. She began her retail career in 1973 at Macy’s West
and held various positions there over the next 19 years.
Marcus moved to become FMG’s president and COO in
June 1997 from Stern’s, where he had been president since
1995. Previously, he was president of the A&S/Jordan Marsh
division of Federated since 1989. Marcus began his retail
career at A&S in 1974.
Federated, Macy’s, and
Bloomingdale’s History
Federated History
A Rich Tradition
Seventy-eight years ago on the morning of March 6, 1929, millions of Americans
opened their edition of The New York Times to find a headline that would send
the business and retail world into a spin of excited chatter and speculation –
“Abraham & Straus and Filene’s to Unite.” The announcement marked the beginning
of the evolution of what was to become one of the largest and most influential
corporations in retail history.
Federated Department Stores was born through the combination of Abraham & Straus of Brooklyn, Filene’s
of Boston, F&R Lazarus & Co. of Columbus, OH, and Bloomingdale’s of New York. Each of these retailers was an
established, prominent presence with a rich history of its own. In joining together, they agreed to maintain
their separate identities while linking their financial interests. These pioneers recognized the immense
opportunity that lay before them and on November 25, 1929, Federated Department Stores was incorporated
as a revolutionary new company in American retail.
As Federated emerged in the years of the Great Depression and World War II, it became apparent that the
corporation was equipped with both resilience and flexibility. It adapted to the times by implementing
innovative retail firsts, such as “pay when you can” credit policies and arranging merchandise by size rather
than color, brand or price. Not surprisingly, one of the best and boldest ideas of the time belonged to Fred
Lazarus, the retailing legend and president of F&R Lazarus. He became concerned in 1939 upon realizing that
Thanksgiving would fall on the last day of November. This meant fewer shopping days in the coveted holiday
shopping season between Thanksgiving and Christmas, a circumstance that could push many retailers from
the black to the red. Mr. Fred, as he came to be called, proposed a brazen solution when he suggested to
President Roosevelt that in the future, Thanksgiving be anchored to the fourth Thursday in November. The
President supported this proposition, and within two years it passed through Congress into law.
When the war came home to America in 1941, Federated
responded with the resolve of a company dedicated to
community and civic support. Selling war bonds, volunteering with the Red Cross, helping in Victory Gardens
and participating in U.S.O. events became part of its daily
business. Thirteen percent of Federated’s workforce fought
in the war, and 56 died in action.
As the nation went on to recover from the strife of a
long war, Federated surged forward into a new era of the
company’s history. It was about to embark on a new venture
sparked by another epiphany credited to Mr. Fred. During
a trip to Houston, TX, in 1944, he was astonished to find
that the sizeable city had not a single department store. It
became obvious to him that Federated had to begin acting
on such opportunities that were there for the taking. Upon
his return, he convinced Federated’s directors that remaining
a holding company was no longer conducive to achieving
1964 and 1979, when its number of stores increased
400 percent and annual sales quadrupled to $4.8 billion.
It also was during this era of powerful and positive change
that Federated shifted its concentration from growth
through acquisitions to expanding the company’s retail
formats. Mr. Fred had stepped down as CEO in 1966 and
passed the reins to his son. Ralph Lazarus recognized retail
trends that shifted demand toward better merchandise and
more brands, leaving the door wide open for Federated to
satisfy consumers whose demand for lower-priced retailers
was not being met. So by the 1970s, Federated had started a
number of discount divisions that operated in Florida, Texas
and California. At the same time, Lazarus also set his sights
on real estate development through a wholly owned
subsidiary, Federated Stores Realty. This resulted in a new
string of regional shopping malls with Federated stores as
their anchors. Federated ended the decade of the ’70s on
a high note as it celebrated its 50th anniversary with the
acquisition of Rich’s in Atlanta, construction of a new
corporate headquarters building in Cincinnati and a total
of 20 divisions and 364 stores.
It became apparent in the 1980s, as the tone of the
industry changed dramatically, that Federated’s endurance
and resolve as a retail powerhouse were going to be tested.
Howard Goldfeder took the reins of CEO from Ralph Lazarus
in 1982 amid a period of changes. As divisional consolidation
was taking place between the company’s Rike’s and Shillito’s
the kind of success possible in the country’s booming retail
industry. He suggested a bold transition to an operating
company that could take advantage of the incredible growth
and expansion opportunities that lay ahead. After much
debate and some resistance, the directors agreed and
Federated was reconstituted as an operating company in
1945, with Fred Lazarus as its president and Cincinnati
as its headquarters.
Federated’s first priorities as an operating company
were expansion and acquisitions that spanned the late
1940s to the early 1960s. By 1964, it was prospering at an
extraordinary pace. Its number of divisions had expanded
from the original five to an impressive 14, and annual sales
for the first time had skyrocketed to more than $1 billion.
The growth continued steadily into the 1970s as Federated
mirrored the population trend of expansion to the suburbs.
New malls and shopping centers were springing up
everywhere, and Federated was there to satisfy the new
demand for a retail presence in suburbia. This new trend
played a major part in the growth of Federated between
Federated History
operations, Federated planned for a new retail concept
called MainStreet, which it promoted as a “junior”
department store. The company also reinforced its longstanding tradition of giving back to the community with the
establishment of the Federated Foundation in 1980, setting
aside $15 million in earnings to create the corpus of this
charitable trust. Things looked stable for the corporation
until 1988 when a Canadian real estate developer named
Robert Campeau turned his sights on Federated. A takeover
ensued, and just two years later Federated was forced to file
for bankruptcy.
In perhaps the most difficult period of its history,
Federated’s strong operations and determined leadership
rebuilt the corporation into an even stronger company. By
1992, Federated emerged from the ashes as a new public
company. Within three years, Federated had doubled in size,
acquiring Macy’s in 1994 and Broadway Stores in 1995. It
dove into the Internet and e-commerce with macys.com and
the acquisition of Fingerhut, a company that was building a
sophisticated e-commerce infrastructure. When the ecommerce bubble burst and the acquisition of Fingerhut
became a very public failure shortly thereafter, Federated
responded with candor. Chairman and CEO Jim Zimmerman
declared that the company remained confident in its resolve
to take prudent risks rather than choosing to stand still.
The new millennium saw Federated make the bold move
of acquiring long-time department store competitor, May
Company. Both companies had very similar histories and
cultures, and both represented decades of roll-ups of local
family-owned department stores. Each had similar sales
volume and stores.
United, a retail powerhouse was created with Macy's
stores in 63 of the top 65 markets. We truly are "America's
Department Store." The acquisition was completed in August
2005, nearly doubling the size of the company and making
Federated the fourth largest non-food retailer in the country.
Seventy-eight years after its founding, Federated is one of
the nation’s most successful and respected retail institutions.
The company continues to prosper by adapting and flowing
with new demands on department stores in an everchanging society. Embracing the words and philosophy of
one of its founders, Fred Lazarus Jr., Federated succeeds by
striving to be “a living mirror of our civilization in which we
see the constant changing needs and wishes of our people.”
Federated History - Chronology
1830 Shillito’s founded in Cincinnati by John Shillito.
1841 Eben Jordan and Benjamin L. Marsh open Jordan
Marsh in Boston.
1851 F&R Lazarus & Company founded in Columbus,
OH by Simon Lazarus.
1858 Rowland H. Macy opens R.H. Macy & Co. as a dry
goods store in New York City. First-day sales
totaled $11.06.
1859 Macy’s first-year sales were approximately
$85,000, on an advertising budget of $2,800.
1865 Wechsler & Abraham (later Abraham & Straus)
founded in Brooklyn, NY by Abraham Abraham
and Joseph Wechsler.
1867 Rich’s founded in Atlanta by Morris Rich.
1867 Stern Brothers (later Stern’s) founded in
Manhattan.
1870 Goldsmith’s founded in Memphis.
1872 Bloomingdale Brothers, Inc. founded in New York
City by Lyman and Joseph Bloomingdale. Firstday sales totaled $3.68.
1877 David May opens the first store of what was to
become The May Department Stores Company in
Leadville, Colo., a silver-mining boom town.
1888 The Straus family acquires a general partnership
with Macy’s.
1890 The Bon Marché founded in Seattle.
1893 The Straus family buys out Joseph Wechsler’s
interest in Wechsler & Abraham, changing the
store’s name to Abraham & Straus. While A&S did
not become part of Macy’s, the two stores kept a
close association, even sharing overseas offices.
1898 Burdines founded in Miami.
1902 Macy’s moves to Herald Square in New York City.
1905 David May moves the headquarters of his growing retail organization to St. Louis.
1923 May Company acquires a department store
company in Los Angeles, adding to its growing
regional coverage in Akron, Ohio; St. Louis; and
Cleveland.
1924 Macy’s Herald Square location becomes largest
store in the world, following completion of 7th
Avenue addition. Also, 10,000 people watch
Macy’s first Thanksgiving Day parade.
1925 Macy’s acquires Davison-Paxon of Atlanta.
1929 Federated Department Stores, Inc. is formed as a
holding company by several family-owned
department stores, including Abraham & Straus
and F&R Lazarus (along with its Cincinnati-based
subsidiary, Shillito’s) and Filene’s of Boston. Corporate offices established in Columbus, OH.
1930 Bloomingdale’s joins Federated. First-year sales
for Federated were $112 million.
1934 A modern merchandising standard is set when
Fred Lazarus (son of Simon) arranges garments in
groups of a single size with a range of style, color
and price in that size, rather than the other way
around. Lazarus based this technique upon
observations made in Paris.
1935 Boston’s Jordan Marsh is one of the founders of
New York City-based Allied Stores Corporation, a
successor to Hahn Department Stores, Inc. A
holding company founded in 1928, Hahn brought
chain store advantages to independent, familyowned department stores.
1939 Fred Lazarus Jr. convinces President Franklin
Roosevelt that changing the Thanksgiving
holiday from the last Thursday of November
to the fourth Thursday, extending the Christmas
shopping season, would be good for the nation’s
business. A 1941 Act of Congress perpetuated
the arrangement.
Federated and Allied stores made shopping
easier during difficult economic times by
offering credit, a “pay when you can” policy
and developing a reputation for community
involvement in times of crisis.
1907 Bullock’s founded by John Bullock and P.G.
Winnett in Los Angeles.
1910 The May Department Stores Company is
incorporated.
1911 The May Department Stores Company is listed on
the New York Stock Exchange, and opens
Famous-Barr in St. Louis.
Federated History – Chronology
1945 Federated moves its offices to Cincinnati. Macy’s
acquires O’Connor Moffat & Company of San
Francisco.
1946 In several ways, Shillito’s becomes the first
department store to embrace the African-American community. It is the nation’s first department
store to give credit to African-Americans, as well
as employ them as salespeople and executives.
The store’s restaurant is the first in downtown
Cincinnati to serve African-American customers.
May Company acquires Kaufmann’s in Pittsburgh.
1947 O’Connor Moffat becomes Macy’s California.
1951 Allied acquires New Jersey’s Stern Brothers,
later known as Stern’s.
1956 Miami-based Burdines becomes a division
of Federated.
May Company begins operating May D&F
in Denver.
1957 Seventeen-year-old designer-to-be Ralph Lauren
sells sweaters at Bloomingdale’s over Christmas
week. The following year, he joins Allied Stores as
assistant menswear buyer.
1959 Federated acquires Dayton, Ohio-based Rike’s
and Memphis-based Goldsmith’s.
May Company acquires Hecht’s in Washington,
D.C., and Baltimore.
1962 Allied acquires the William H. Block Company
of Indianapolis.
1964 Federated breaks the 10-figure barrier for the
first time, netting annual sales of $1.215 billion.
Federated acquires Los Angeles’ Bullock’s and
I. Magnin.
1966 May Company acquires Meier & Frank in
Portland, OR.
1967 Allied also passes the billion dollar mark, with
annual sales of $1.024 billion.
1968 Black Retail Action Group (BRAG), founded in part
by Abraham & Straus executives, gives technical
assistance to minority-owned businesses and
scholarships to retailing students. This furthers
A&S’ commitment to African-Americans; the company was the country’s first major retailer to sign
up for Plans for Progress, President Kennedy’s
commission on job opportunities for AfricanAmericans.
1976 Through an exchange of common stock,
Federated acquires Atlanta-based Rich’s.
1980 To help meet the civic, health and welfare,
educational and cultural needs of the communities Federated serves, the company invests $15
million to establish a foundation.
1982 The merger of Rike’s of Dayton and Shillito’s of
Cincinnati results in Shillito-Rikes.
1985 The newly formed Federated Systems Group
(then known as The SABRE Group) begins
the conversion of all Federated divisions to a
common electronic data processing system.
Davison’s of Atlanta changes its name to Macy’s.
1986 A single, billion-dollar organization is formed
with the merger of Federated’s Shillito-Rikes of
Cincinnati, and Columbus-based Lazarus. With
headquarters in Cincinnati, the division operates
under the Lazarus name.
Campeau Corporation acquires Allied Stores
Corporation, which is reorganized under the
merger agreement.
1986 In what was then retail’s largest acquisition, May
Company acquired Associated Dry Goods and
added Lord & Taylor, J.W. Robinson’s and L.S.
Ayres, among others, to its collection of regional
department stores.
1987 Federated buys Allied’s Indianapolis-based Block’s
division, incorporating it into Lazarus.
1988 Campeau Corporation acquires Federated.
Several Federated divisions are sold to other
retailers. May Company purchases Foley’s and
Filene’s. Macy’s purchases Bullock’s and I. Magnin
from Campeau. To consolidate with Federated,
Allied’s New York headquarters move to Cincinnati. Allied – operating in tandem with Federated
– comprises The Bon Marché, Jordan Marsh, Maas
Brothers and Stern’s. Goldsmith’s merges into
Rich’s, although the Goldsmith’s nameplate is
maintained in the Memphis market.
1989 Federated forms its Financial, Administrative and
Credit Services operation (The FACS Group) in
suburban Cincinnati to centralize credit services
for all department store divisions.
Federated’s employee volunteer program,
Partners in Time, is founded at Rich’s/Goldsmith’s
as a way to give back to the community.
1990 In January, saddled by debt resulting from the
highly leveraged Campeau takeover of Federated,
both Federated and Allied file for bankruptcy
reorganization. The reorganizing of more than
$8 billion of debt begins. Allen Questrom
becomes chairman and chief executive officer,
joining James M. Zimmerman, president and
chief operating officer, to form the senior management team that would resurrect the company.
1991 Divisional consolidations begin. The company’s
Florida operations, including all former Maas
Brothers/Jordan Marsh stores, operate under the
Burdines name, and division headquarters are
consolidated in Miami.
1992 A new public company – Federated Department
Stores, Inc. – emerges in February with 220
department stores in 26 states and annual sales of
approximately $7 billion. The former Allied Stores
Corporation is merged into Federated.
A consolidation of the A&S and Jordan Marsh
divisions results in the A&S/Jordan Marsh
division, headquartered in Brooklyn, NY. Early
in the new year, Macy’s files for protection under
Chapter 11.
1995 Rich’s/Goldsmith’s and Lazarus are consolidated
into one division – Rich’s/Lazarus/Goldsmith’s,
based in Atlanta and operating stores in nine
southeast and midwestern states.
Federated acquires Broadway Stores, Inc., based
in Los Angeles. Initially, this added 82 Broadway,
Emporium and Weinstock’s department stores in
California and four other southwestern states with
annual sales of more than $2 billion. Federated
announces that 56 of these stores will be converted to the Macy’s nameplate. Five others will
become Bloomingdale’s, while other locations will
be sold or closed.
Federated Logistics is expanded to handle distribution, logistics functions and vendor technology
for all Federated divisions nationwide.
A&S stores, already a part of the Macy’s East
division, are converted to the Macy’s nameplate.
1993 Federated announces the centralization of divisional accounting and accounts payable functions
in Cincinnati. In addition, a management realignment reconfigures merchandise distribution for its
northeastern divisions.
1994 Federated acquires the Joseph Horne Co. of Pittsburgh, adding 10 Pennsylvania stores to its
Lazarus division. In December, Federated acquires
R.H. Macy & Co., creating the largest department
store retailer in the nation. Acquisition approval,
granted by U.S. Bankruptcy Court in December,
culminates Macy’s three-year reorganization plan.
Macy’s East, headquartered in New York City,
merges with A&S/Jordan Marsh to form a
$4 billion retailing division of Federated. In
San Francisco, Macy’s West continues to operate
all West Coast Macy’s and Bullock’s stores, as
Federated restores its presence in California
and Texas.
Federated announces the discontinuation of the
I. Magnin chain and 13 I. Magnin stores are sold or
converted to Macy’s or Bullock’s.
Federated Logistics is formed to coordinate the
company’s distribution facilities and functions in
the northeastern United States.
Federated History – Chronology
1996 Jordan Marsh stores in the northeastern United
States, already part of the Macy’s East division, are
converted to the Macy’s nameplate.
Meanwhile, Bullock’s stores in Southern
California, already part of the Macy’s West
division, are renamed Macy’s.
May Company acquires Strawbridge’s in
Philadelphia.
The Federated Department Stores Foundation
is reactivated as the company’s primary vehicle
for charitable giving. Total contributions by
Federated, its divisions and the Foundation
were $7.8 million in fiscal 1996.
Bloomingdale’s opens its first California stores
with four locations – three in the Los Angeles area
and one in Palo Alto.
Macy’s West launches www.macys.com.
1997 In May, James M. Zimmerman succeeds Allen
Questrom as chairman and chief executive officer
of Federated. Terry J. Lundgren becomes president
and chief merchandising officer.
1998 For the first time since 1988, Federated’s debt was
rated by major agencies as investment grade. In
the fall, the company launches a new Macy’s By
Mail catalog and re-launches macys.com.
May Company acquires The Jones Store in
Kansas City, MO.
1999 Fingerhut Companies, Inc. of Minnetonka, MN, a
leading direct-marketing company, is acquired by
Federated in March.
May Company acquires Zions Co-operative
Mercantile Institution (ZCMI) stores in Utah
and Idaho.
2000 A new private brand of apparel and accessories
for children, called Greendog, debuts at stores
across the country.
2001 In February, Federated announces that its
Stern’s division will be closed, with most locations
being converted to the Bloomingdale’s or Macy’s
nameplates.
In July, Federated acquires Liberty House, Hawaii’s
largest retailer and only conventional department
store group. It becomes part of Macy’s West.
2002 Federated disposes of Fingerhut.
Terry J. Lundgren becomes chief operating officer
in addition to president and chief merchandising
officer.
2003 Federated integrates the Macy’s nameplates
with its regional department stores – creating
Bon-Macy’s, Burdines-Macy’s, Goldsmith’s-Macy’s,
Lazarus-Macy’s and Rich’s-Macy’s. Macy’s
Corporate Marketing developed.
Bloomingdale’s enters the Atlanta market for the
first time with two stores.
Terry J. Lundgren becomes president and chief
executive officer. James M. Zimmerman remains
chairman of the board.
Federated board initiates quarterly dividends.
2004 Terry J. Lundgren becomes chairman, president
and CEO as James M. Zimmerman retires as
chairman of the company.
Macy’s Home Store division is formed.
May Company acquires Marshall Field’s.
2005 Federated begins operating nationwide under
two national store nameplates – Macy’s and
Bloomingdale’s – as all regional department
store names are converted to the Macy’s brand.
The company begins its first national advertising
for Macy’s.
Macy’s launches a new customer loyalty
program, with escalating benefits for its largest
customers, as it issues new credit cards on about
14 million accounts.
Federated acquires The May Department Stores
Company. The acquisition creates a stronger, more
resourceful company with more stores nationwide.
2006 More than 400 former May Company stores
convert to Macy’s, creating a nationwide store
focused on delivering fashion and affordable
luxury to customers from coast to coast.
Macy’s launches its first-ever national advertising
campaign.
Federated divested Lord & Taylor, David’s Bridal
and Priscilla of Boston, which were acquired as
part of The May Department Stores Company.
2007 Federated sold its 507-store After Hours
Formalwear business to Houston-based
Men’s Wearhouse.
Shareholders vote on corporate name change
from Federated Department Stores, Inc. to
Macy’s, Inc.
Macy’s: A History
No one would have guessed that the small, fancy
dry goods store that opened on the corner of
14th Street and 6th Avenue in New York City in
1858 would grow to be one of the largest
department store retailers in the world.
But after several failed retail ventures, Rowland Hussey
Macy’s determination and ingenuity paid off at the age of 36
with the launch of R.H. Macy & Co. He adopted a red star as
his symbol of success, dating back to his days as a sailor.
First-day sales totaled $11.06 but by the end of the first full
year, sales grossed almost $90,000. By 1877, R.H. Macy & Co.
had become a full-fledged department store occupying the
ground space of eleven adjacent buildings.
Always the innovator, Macy’s is known for several firsts
that changed the retail industry. Macy’s was the first retailer
to promote a woman, Margaret Getchell, to an executive
position, making business history. Macy’s pioneered such
revolutionary business practices as the one-price system, in
which the same item was sold to every customer at one
price, and quoting specific prices for goods in newspaper
advertising. Known for its creative merchandising, Macy’s
was the first to introduce such products as the tea bag, the
Idaho baked potato and colored bath towels. Macy’s also
was the first retailer to hold a New York City liquor license.
By November 1902, the store had outgrown its modest
storefront and moved uptown to its present Herald Square
location on Broadway and 34th Street, establishing an
attraction for shoppers from around the world. With the
store’s 7th Avenue expansion complete in 1924, Macy’s
Herald Square became the “World’s Largest Store,” with over
1 million square feet of retail space.
By 1918, R.H. Macy & Co. was generating $36 million in
annual sales. Yet, the prosperity of the retailer was never
more apparent than when the company went public in 1922
and began to open regional stores and take over competing
stores. In 1923, the Toledo-based department store LaSalle &
Kock was acquired; the next year, Davison-Paxton in Atlanta
was acquired and in 1936, the Newark-based Bamberger’s
was purchased.
To help celebrate their new American heritage, Macy’s
immigrant employees organized the first Christmas Parade
in 1924. The procession featured floats, bands, animals from
the zoo and 10,000 onlookers, beginning a time-honored
tradition now known as the annual Macy’s Thanksgiving
Day Parade.
In 1945, the company expanded west and purchased
O’Connor Moffatt and Company in San Francisco. Two years
later, O’Connor Moffatt stores, including the landmark Union
Square store that opened in 1866, were converted to Macy’s
after a survey indicated that San Franciscans would welcome
the name.
Macy’s California broke new ground with the first
department store flower show in 1946. What began as a
fragrance promotion in the cosmetics department now
annually welcomes the spring season, treating visitors to
a botanical, cultural and community spectacle. In 1971,
Macy’s Union Square store’s lower level, once cluttered with
bargains, was transformed into “The Cellar,” changing the
way customers shop for housewares. Due to its success,
the Herald Square store followed suit five years later.
On December 19, 1994, Federated acquired R.H. Macy
& Co., creating the world’s largest premier department
store company. Federated Department Stores operated
over 400 department stores and more than 157 specialty
stores in 37 states.
A & S Department Stores, purchased by Federated in 1929,
were converted to the Macy’s nameplate in May 1995. Also
in 1995, Federated acquired The Broadway Department
Stores, bringing Broadway, Emporium and Weinstocks to the
Macy’s family, as well as six former I. Magnin stores; some 46
stores were converted to Macy’s. Following the lead of A & S,
Jordan Marsh Department Stores of Boston, already owned
by Federated, were converted to Macy’s in March 1996. In
January 2001, Macy’s absorbed 17 Stern’s Department Stores
located in New York and New Jersey. In June 2001, Federated
purchased the Liberty House operations in Hawaii and
Guam, bringing the proud Macy’s tradition and heritage
to the Pacific.
Macy’s entered 2005 with about 240 locations, primarily
on the East and West Coasts. With the conversion of
Federated’s regional store nameplates in March 2005,
Macy’s grew to about 425 locations across the country.
In September 2006, with the conversion of stores acquired
from May Company, Macy’s now serves customers through
more than 800 stores in virtually every major geographic
market in the United States, as well as the macys.com
Web site.
Bloomingdale’s: A History
Bloomingdale’s began with a 19th century fad,
and the extraordinary vision of two brothers.
Lyman and Joseph Bloomingdale pioneered
nearly every major change in the evolution of
department stores – if they weren’t the first with
an idea, they simply did it bigger and better than
anyone else. Their innovative retailing
philosophy guided Bloomingdale’s in its
beginning and that strategy continues today,
justifiably earning Bloomingdale’s the reference
“Like No Other Store in the World.”
The first retail endeavor of the Bloomingdale brothers was
a Ladies’ Notion Shop in New York. In 1872, Bloomingdale’s
expanded and opened their East Side Bazaar, selling a
variety of women’s fashions. This was a bold move in the era
of specialty shops; the Bazaar became a harbinger of the
true “department store.” By 1929, Bloomingdale’s covered an
entire city block.
Two years later, the glamorous Art Deco edifice that still
graces Lexington Avenue was completed. In 1949,
Bloomingdale’s began its real expansion, opening its first
satellite store in Fresh Meadows, Queens and by 1959,
Bloomingdale’s had created a complete circle of stores
around the flagship, in New Jersey, Westchester County and
Long Island. This dramatic growth continued in the ‘70s and
‘80s with the opening of stores in the Northeast, Florida, and
Chicago. Bloomingdale’s was on its way to becoming a true
national entity. That vision culminated in 1996 with the
addition of its first four stores in California, the most
ambitious expansion in the company’s history, followed by
two new stores in the Atlanta market in 2003.
From the beginning, the Bloomingdale’s brothers catered
to America’s love of international goods, and by the 1880s,
their European selection was dazzling. A buying office in
Paris in 1886 was the beginning of a network that now spans
the globe. The 1960s brought promotions resulting from
Bloomingdale’s fascination with the foreign market: the first
was a small affair called “Casa Bella” featuring merchandise
for the home from Italy.
Over the next 30 years, the promotions took on a grand
scale – including unique merchandise and cultural exhibits
that would touch every department in Bloomingdale’s.
Major transformation of the Bloomingdale’s image came in
the 1960s and 1970s. The promotions were so exciting that
the term “Retailing as Theater” was coined to describe
Bloomingdale’s “happenings.” It was the era of pet rocks and
glacial ice cubes, of visits by movie stars and royalty, from
Elizabeth Taylor to Queen Elizabeth II.
The new direction in merchandising was both to seek and
to create. Buyers covered the world to find exclusive, one-ofa-kind items. When they couldn’t find what they wanted,
they had it made. In fashion, Bloomingdale’s launched new
designers and created boutiques for already-famous names.
Among the discoveries: Ralph Lauren, Perry Ellis and Norma
Kamali – and for the first time in America: Sonia Rykiel, Kenzo
and Fendi ready-to-wear. Designers opening their first instore boutiques at Bloomingdale’s include Yves St. Laurent,
Calvin Klein, Claude Montana and Thierry Mugler.
In 1961, Bloomingdale’s made retail history in yet another
area by introducing the first designer shopping bag. Artist
Joseph Kinigstein was commissioned to create a bag for the
“Esprit de France” promotion. Rather than doing the obvious
– ladylike flowers in pastel colors – he reproduced antique
French tarot cards in bold red, black and white. Most daring
of all, the bag omitted the store name. Even so, it was
unmistakably Bloomingdale’s, and the collector’s shopping
bag was launched. Since then, both famous and fledgling
artists, architects and ad designers have created
Bloomingdale’s bags. Their designs have been featured in art
museums all over the world. In 1971 “model rooms,” a
highlight of Bloomingdale’s since 1947, gained worldwide
attention. “The Cave,” an intricate multi-level frame sprayed
entirely in white polyurethane, was a spectacular example of
the lengths to which Bloomingdale’s would go to make a
statement of style. Over the years, the model rooms have
been showcases for the talents of everyone from architect
Frank Gehry to filmmaker Federico Fellini.
During the 1970s, Bloomingdale’s was a favorite stop of
the international avant-garde, epitomized locally by the
“Young East Sider” who lived right in the neighborhood. In
1973 the store wanted to stamp the Bloomingdale’s name
on panties to launch an intimate apparel promotion; they
chose the company nickname as a nod to the young, trendy
crowd, and the “Bloomie’s” logo was born. Soon, New Yorkers
were affectionately
referring to the city’s
second most popular
tourist attraction after
the Statue of Liberty
as “Bloomie’s” and the
hottest souvenir in
town was anything
emblazoned with
“Bloomie’s.” From the
late ’80s to the
present, the economy
and retailing changed
– thus changing the
buying habits of consumers. As usual, Bloomingdale’s kept
up with the times, and prepared for the future. Today, there
is an increased emphasis on building customer services and
relationships, while continuing the unique and exclusive
aspects that made Bloomingdale’s world famous.
With a reputation for quality, creativity and uniqueness,
Bloomingdale’s has remained at the forefront of retailing
worldwide. Bloomingdale’s speaks to its customers in a
language they understand: service, selection and fashion,
making Bloomingdale’s “Like No Other Store in the World.”
Board of Directors/Corporate Management
Board of Directors
Meyer Feldberg
Dean Emeritus and
Sanford C. Bernstein Professor
of Leadership and Ethics
Columbia Business School
Columbia University
Joseph A. Pichler
Former Chairman
The Kroger Co.
Craig E. Weatherup
Former Chairman &
Chief Executive Officer
The Pepsi Bottling Group, Inc.
Sara Levinson
Former President
Women’s Group of Rodale, Inc.
Non-Executive Chairman
ClubMom, Inc.
Joyce M. Roché
President & Chief Executive Officer
Girls Incorporated
Marna C. Whittington
Chief Operating Officer
Allianz Global Investors
President
Nicholas-Applegate
Capital Management
Terry J. Lundgren
Chairman, President &
Federated Department Stores, Inc.
William P. Stiritz
Chairman of the Board
Energizer Holdings, Inc. and
Ralcorp Holdings, Inc.
Joseph Neubauer
Chairman & Chief Executive Officer
ARAMARK Holdings Corporation
Karl M. von der Heyden
Former Vice Chairman
PepsiCo, Inc.
Corporate Management
Executive Officers
Terry J. Lundgren assumed the title of
chairman, president and CEO of Federated
in January 2004. Prior to this, he served as
president and chief operating officer, a title
he assumed in March 2003 after having
served as president and chief merchandising
officer since May 1997.
Lundgren began his retailing career in
1975 as a trainee with Bullock’s, a Los
Angeles-based division of Federated. He
held positions of increasing responsibility
over the next decade in buying, store management, human
resources and senior-level store management, as well as serving
as the division’s director of stores. Lundgren was named senior
vice president and general merchandising manager of Bullock’s
in 1984. In 1987, he was named president and CEO of Bullocks
Wilshire, then an upscale chain of specialty department stores
owned by Federated.
Terry J. Lundgren
Chairman, President &
Lundgren left Federated in 1988 to join Neiman Marcus, where
he served as executive vice president and shortly thereafter was
named chairman and CEO. He returned to Federated in April 1994
as chairman and CEO of the Federated Merchandising Group.
Thomas G. Cody was elected in February
2003 as vice chair with responsibility for legal
and human resources, internal audit, external
affairs and the company’s philanthropic
activities. Previously, he served as executive
vice president for legal and human resources
since May 1988. From 1982 to 1988, Cody
held the position of senior vice president for
Thomas G. Cody
law
and public affairs for Federated. Prior to
Vice Chair
joining Federated, he spent six years with Pan
American World Airways, Inc. as senior vice president, general
counsel and secretary.
Thomas L. Cole was elected Federated vice
chair in 2003. He is responsible for the store
design and construction and corporate real
estate functions, as well as the Federated
Logistics and Operations (FLO), Federated
Systems Group (FSG) and Financial,
Administrative and Credit Services (FACS)
Group divisions. Cole has served as chairman
Thomas L. Cole
of all three support divisions – FLO since
Vice Chair
1995, FSG since 2001 and FACS since 2002.
Previously, Cole was president of Federated Merchandising for six
years and served as senior vice president for financial services at
the Lazarus division. He began his career at Federated in 1972.
Janet E. Grove was elected
Federated vice chair in February
2003 in addition to serving as
chairman of the Macy’s
Merchandising Group (MMG), a
position she has held since 1998.
Previously, she served as Federated
Merchandising Group’s
Janet E. Grove
(predecessor to MMG) executive
Vice Chair
vice president for center core,
cosmetics and home merchandise. She added the title
of chief executive officer in December 1999. Previously,
she was executive vice president for ready-to-wear and
center core. Grove joined FMG in January 1996 as a
senior vice president from Broadway Stores, Inc., where
she was executive vice president for home merchandise
and center core. She began her retail career in 1973 at
Macy’s West.
Susan D. Kronick, who is responsible
for all of the company’s department
store divisions, was elected
Federated vice chair in February
2003. Previously, she was group
president responsible for overseeing
the regional department store
divisions. Kronick also has served
Susan D. Kronick
as
chairman and CEO of Burdines
Vice Chair
(now Macy’s Florida) and president
and COO of Rich’s/Lazarus/Goldsmith’s (now Macy’s
South). She joined Federated in 1973 as an executive
trainee at Bloomingdale’s and rose through its ranks
to become senior executive vice president and director
of stores.
Karen M. Hoguet was elected
executive vice president and chief
financial officer of Federated in May
2005. She is responsible for all of
the company's financial functions,
as well as Area Research. Previously,
Hoguet served as senior vice
president and chief financial officer,
Karen M. Hoguet
a position she had held since 1997.
Executive Vice President
Hoguet joined the company in
& Chief Financial Officer
1982 from the Boston Consulting
Group and served in a range of financial management
capacities, including senior vice president for planning
and treasurer of the corporation.
Corporate Management
Senior Vice Presidents
David W. Clark
Human Resources
Mark S. Cosby
Property Development
Joel A. Belsky
Controller
William L. Hawthorne III
Chief Diversity Officer
& Legal Affairs
Bradley R. Mays
Tax
Gary J. Nay
Real Estate
James A. Sluzewski
Corporate Communications
& External Affairs
Cynthia Ray Walker
Area Research
Felicia Williams
Internal Audit
Michael Zorn
Employee Relations
Dennis J. Broderick
General Counsel & Secretary
Vice Presidents
Shareholder Information
Federated Corporate Governance
Federated believes strongly in good corporate governance and transparency in financial reporting. If you would like to
know more, please visit the Corporate Governance section of our corporate Web site at www.fds.com/corporategovernance.
Common Stock
Shares of Federated common stock are traded on the New York Stock Exchange. The company’s trading symbol is FD.
The approximate number of Federated shareholders of record, as of Feb. 3, 2007, was 26,600. As of that date, there
were approximately 497 million shares of Federated common stock outstanding, excluding shares held by Federated.
Share and per share amounts have been adjusted as appropriate to reflect the two-for-one stock split effected in the
form of a stock dividend distributed on June 9, 2006.
If shareholders approve changing the name of the company, the new corporate name will take effect June 1, 2007,
and Macy’s, Inc. will trade under the symbol of “M” on the New York Stock Exchange.
Shares
Traded
Average
Daily Volume
Low
High
Dividends
Paid
First Quarter
286,909,000
4,347,106
$32.37
$39.21
$0.1250
Second Quarter
274,271,000
4,571,200
32.57
39.69
0.1275
Third Quarter
304,328,200
4,755,100
33.52
45.01
0.1275
Fourth Quarter
454,792,000
6,996,800
36.12
44.86
0.1275
First Quarter
343,066,400
5,446,100
27.45
32.54
$0.0675
Second Quarter
281,581,400
4,469,500
28.84
38.62
0.0675
Third Quarter
360,154,000
5,627,400
28.78
39.02
0.1250
Fourth Quarter
124,537,800
5,631,800
29.90
37.48
0.1250
2006
Prices
2005
To Reach Us
Transfer Agent for Federated Shares:
www.fds.com/financial:
The Bank of New York
Shareholder Relations Department
Church Street Station
P.O. Box 11258
New York, NY 10286-1258
1-866-337-3311
• Sign up to have Federated’s news releases sent
to you via e-mail by subscribing to News Direct.
• Get the latest stock price and chart, or take advantage
of the historical price look-up feature.
Call:
Federated Investor Relations Department
Monday-Friday, 8:30 a.m. - 5 p.m. (ET)
1-513-579-7028
Federated News & Information Request Hotline:
1-800-261-5385
Visit Us on the Internet:
www.fds.com
www.bloomingdales.com
www.bloomingdalesJOBS.com
www.bloomingdales.weddingchannel.com
www.macys.com
Write:
www.macysJOBS.com
Federated Department Stores, Inc.
Investor Relations Department
7 West Seventh Street
Cincinnati, OH 45202
www.macys.weddingchannel.com
Federated Operates Stores In:*
ALABAMA: 400 Employees
Macy’s South (2)
MAINE: 300 Employees
Macy’s East (2)
ARIZONA: 3,000 Employees
Macy’s West (11)
MARYLAND: 4,100 Employees
Bloomingdale’s (1)
Macy’s East (23)
CALIFORNIA: 33,800 Employees
Macy’s West (135)
COLORADO: 2,200 Employees
Macy’s West (14)
CONNECTICUT: 3,100 Employees
Macy’s East (13)
DELAWARE: 600 Employees
Macy’s East (4)
FLORIDA: 12,500 Employees
Macy’s Florida (61)
GEORGIA: 7,100 Employees
Macy’s South (24)
HAWAII: 2,200 Employees
Macy’s West (19)
IDAHO: 800 Employees
Macy’s Northwest (8)
ILLINOIS: 7,700 Employees
Macy’s Midwest (7)
Macy’s North (17)
INDIANA: 2,400 Employees
Macy’s North (1)
KANSAS: 700 Employees
KENTUCKY: 1,200 Employees
Macy’s South (4)
LOUISIANA: 500 Employees
Macy’s South (4)
MASSACHUSETTS: 5,400 Employees
Macy’s East (27)
MICHIGAN: 5,600 Employees
Macy’s North (22)
MINNESOTA: 5,600 Employees
Macy’s North (14)
OHIO: 9,800 Employees
Macy’s North (1)
OKLAHOMA: 500 Employees
Macy’s South (5)
OREGON: 2,100 Employees
PENNSYLVANIA: 7,200 Employees
Macy’s East (16)
RHODE ISLAND: 500 Employees
Macy’s East (2)
MISSOURI: 5,400 Employees
SOUTH CAROLINA: 300 Employees
Macy’s South (2)
MONTANA: 200 Employees
SOUTH DAKOTA: 100 Employees
Macy’s North (1)
NEVADA: 1,600 Employees
Macy’s West (9)
TENNESSEE: 1,800 Employees
Macy’s South (10)
NEW HAMPSHIRE: 1,000 Employees
Macy’s East (6)
TEXAS: 9,400 Employees
Macy’s South (55)
Macy’s West (2)
UTAH: 900 Employees
VERMONT: 100 Employees
Macy’s East (1)
VIRGINIA: 5,000 Employees
Macy’s East (12)
Macy’s South (16)
WASHINGTON: 5,700 Employees
WEST VIRGINIA: 300 Employees
WISCONSIN: 1,200 Employees
Macy’s North (5)
WYOMING: 100 Employees
WASHINGTON, D.C.: 400 Employees
Macy’s East (1)
GUAM: 200 Employees
Macy’s West (1)
PUERTO RICO: 400 Employees
Macy’s East (1)
NEW JERSEY: 9,000 Employees
Macy’s East (31)
NEW MEXICO: 300 Employees
Macy’s West (2)
NEW YORK: 23,000 Employees
Macy’s East (49)
NORTH CAROLINA: 1,500 Employees
Macy’s South (12)
NORTH DAKOTA: 300 Employees
Macy’s North (2)
Number of Stores .......................................................... 858
Store Gross Sq. Ft.
(in thousands)...................................................... 156,401
Total States ................................................................... 45
plus the District of Columbia,
Guam and Puerto Rico
Total Number of Employees
of continuing operations ................................... 188,000
* Information as of March 3, 2007, except for number of employees,
which is as of February 3, 2007.
IBC IS BLANK
www.fds.com
7 West Seventh Street
Cincinnati, Ohio 45202
513-579-7000
151 West 34th Street
New York, NY 10001
212-494-1601

Building Our Brands… One Customer at a Time.

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