“The financial group does not report news,” Macy’s Inc. said. CFO Adrian V. Mitchell says. “The finance team will help shape decisions with our partners across the organization. That mindset shift was critical.
As we head into 2023, I follow up with Mitchell on its progress Macy’s transformation For digital business. He says the finance, planning, merchandising and supply chain teams are working together to modernize the retailer, which has been in business for more than 150 years.
“A big part of the modern department store ambition is to reinvent Macy’s by building new capabilities, getting out of legacy capabilities, and showing up for the customer,” he says.
By streamlining its supply chain, Macy’s improved merchandise turnover increased 15% compared to the pre-pandemic period, the company reported in its Q3 earnings. Much of supply chain and inventory management has to do with analytical capabilities using tools like machine learning and demand forecasting, Mitchell says.
By focusing deeply on the supply chain in 2021, “we were able to get most of our inventory in time for the holidays, and very little. [of 2021 goods] Actually shed in 2022,” he says. “In 2022, we see supply chain loosening. Fill rates will continue to improve every month and every quarter this year. So we’ve adjusted and we’re looking at confirmed orders.
He continues, “If you think about the 2022 holiday, we had 55% innovation, which is 30 percentage points higher than in 2019. We come into the season with a lot of innovation as a fashion retailer and we can really adjust. Based on season demand profile.”
Location-level pricing is one area where Macy’s uses machine learning, Mitchell says. For example, they can see the speed of a particular item like a black polo sweater, its availability in specific locations, and its availability for digital commerce. “We can predict what the appropriate markdown size and timing should be for that black polo sweater,” he explains. This is different from the past, he says, when he looked at the sell-through ratio and made decisions on markdowns that apply to each store in a particular region.
“Price analysis continues to pay dividends for us,” Mitchell says.
Mitchell has replaced manual processes with technology, which includes organizational reporting “that’s a reality of how the entire leadership team and their management teams talk about performance,” he says. “We’re talking about inventory, sales, margin, credit business, market business, all in one data and information.”
Macy’s Reported net sales in Q3 was $5.2 billion, down 3.9% compared to the same period last year. However, the retailer beat estimates. “We are pleased to be at the high end of our sales expectations,” says Mitchell. “We were able to easily beat the bottom line compared to expectations.”
“Our stores were ready for the holidays by mid-October,” he says. “This year, we believe the holiday pattern is the pre-pandemic pattern.” Black Friday, Cyber Monday, Cyber Week and Christmas take 10 to 12 days, he says.
“The consumer is under pressure,” Mitchell says. “We recognize that things are on the unwise side of the dollar. So we have to continue to please the customer. The company will be able to share more data in January,” he says.
For Mitchell’s finance team, getting a 360-degree view of the business is critical and can’t just be done from your desk. “My finance chiefs and their teams are leaving now [distribution centers]They go into stores, they sit in working sessions with business partners and understand the levers we need to pull to drive financial outcomes,” he explains.
See you tomorrow.
Register here to receive CFO Daily in your inbox on weekday mornings.
A new report from Accenture, “Payments are personal,” explores the consumer transaction journey and provides insight into future payment innovations. Globally, 66% of consumers surveyed use cash to make payments at least five times a month. By region, North America has the lowest percentage of consumers (59%) who use cash frequently. Debit card is the second most frequent payment method globally (64%). More than half of the respondents (56%) use a digital wallet. Biometrics payments are the recognition of physical characteristics such as retinas, fingerprints and faces. 42 percent of respondents believe biometrics will be widely used by 2025. Also, 9% said they were ready to use in-person as their primary method of payment by 2025. In a survey of more than 16,000 consumers in 13 countries across Asia, Europe, Latin America and North America.
Amazon Web Services (AWS), the cloud computing services company and Amazon’s “best-performing and least-recognized business, is shedding few, if any jobs,” and may even add headcount next year, he writes. luck’Jeff Colvin. For his piece, “Amazon Web Services’ CEO wants to hire people who are ‘restless and disaffected’ Here’s why,Colvin sat down with Adam Celebski to talk about AWS’s culture and how he chooses team members.
Christina Zamaro Promoted to EVP and CFO in Goodyear Tire & Rubber Company (Nasdaq: GT), effective Jan. 1. Darren R. Wells will be succeeded by Jamaro, who will become EVP and CEO. Jamaro joined Goodyear in 2007 after several years at Ford Motor Company. He is currently VP Finance and Treasurer at Goodyear. In more than 15 years with the company, Zamaro has played key roles in financial strategy, treasury and investor relations functions.
James M. Moses Named vice president and CFO of First Hawaii Bank and its parent company First Hawaii, Inc. (Nasdaq: FHB), Jan. 3 with effect from Moses has over 20 years of experience in the banking industry. St. Louis, Mo., where he served as EVP and CFO. Joined the company from First Bank in His previous experience includes serving as EVP and CFO of Berkshire Hills Bancorp, and SVP and Manager of Asset Liability Management at Webster Bank.
“We still have a ways to go.”
Federal Reserve Chairman Jerome Powell told a news conference Wednesday that officials are no closer to ending their campaign of interest rate hikes to control inflation. Powell’s statement followed the Fed’s announcement of a 0.50 percentage point interest rate hike, smaller than the four previous hikes of 0.75 percentage points. Officials have signaled that borrowing costs will be higher than expected next year. Good luck reported.