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84 ROCHELLE R. BRUNSON AND MARLENE M. REED

in such cities as Toledo, San Francisco, and Kansas City. Then in 1983, the company began
opening its own stores outside of New York.
In 1986, Macy’s chairman Edward Finkelstein led a $3.5 billion buyout of Macy’s
and took it private. The company’s debt load increased into the early 1990s, and Macy’s
filed for bankruptcy in 1992. Three years later, Federated Stores bought the 82 Broadway
Stores and renamed 52 of them Macy’s in 1996.
In 2001, Federated Stores decided to convert 19 of its Stern’s locations in New Jersey
and New York to its two strongest department store brands: Macy’s and Bloomingdale’s. In
the first half of 2006, five underperforming Lord & Taylor stores were closed and a sixth
was converted to a Macy’s store.
In June 2007, Federated Stores changed its corporate name to that of its most famous
brand, Macy’s. Along with its name, the department store operator changed its ticker
symbol to “M” on the New York Stock Exchange. In September 2007, the Martha Stewart
Collection of merchandise for the home (including bed and bath textiles, housewares, casual
dinnerware, flatware and glassware, and cookware) debuted in all Macy’s full-line stores. In
2007, Macy’s opened 10 stores and a single furniture gallery. Then in 2008, Macy’s cele-
brated its 150th birthday by opening four new Macy’s stores and one furniture gallery.
On August 30, 2005, Federated completed its $11 billion acquisition of rival May
Department Stores. Then in October 2006, Federated completed the sale of its 48-store Lord
& Taylor department store chain to NRDC Equity Partners LLC for nearly $1.1 billion. Lord
& Taylor operated stores in a dozen states and the District of Columbia.
In early 2007, the department store operator completed the divestment of its bridal
division with the January sale of David’s Bridal to buyout firm Leonard Geen & Partners
for about $750 million. In April of that year, Macy’s sold After Hours Formalwear to The
Men’s Wearhouse for about $100 million.

Internal Factors

Basic Values
Macy’s has some well-published values intended to guide the behavior of all their employ-
ees, as follows:
• We subscribe to ethical business practices in every facet of our business.
• We will protect the interests of our shareholders.
• We will provide quality and value to our customers in all dealings.
• We will obey all laws.
• We will treat others as we want them to treat us.
• We will respect the rights and property of others.
• We will be good corporate citizens.
Macy’s believes that the timeless values that made our nation strong are the same
values that make the company strong. These values are:
• 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.

Organization
Macy’s has developed a new organizational strategy named “My Macy’s” based on cus-
tomer research and input from Macy’s store managers, senior division executives,
merchandise vendors, and industry experts. Exhibit 1 shows Macy’s divisional organization
chart, and Exhibit 2 provides Macy’s division review.

Merchandising
Macy’s strives to bring to customers niche brands and categories as indicated in Exhibit 3.
The company has recently rolled out fresh, handmade cosmetics, soaps, and bath products