Latest news with #luxuryRetail
Yahoo
08-07-2025
- Business
- Yahoo
Saks Is Losing Luxury Shoppers in the Wake of Its Neiman Marcus Takeover
Saks Global is going through some growing pains. The parent company of Saks Fifth Avenue bought Neiman Marcus in a $2.7 billion acquisition last year, bringing both department-store behemoths under the same umbrella (along with Bergdorf Goodman). And though the move was meant to unite the luxury titans, the brands have run into some trouble: Consumers are opting to shop at other high-end retailers instead, such as Bloomingdale's and Nordstrom, Bloomberg reported. More from Robb Report This $6.7 Million Ultra-Modern U.K. Home Appeared in the Robert Pattinson Sci-Fi Film 'Mickey 17' Singaporeans Are Splurging Despite a Global Luxury Slump A Modernist Home in Montecito Designed by a Pioneering Architect Just Listed for $18 Million Saks Fifth Ave. saw its sales drop 16 percent year-over-year from the quarter ending June 30, while Neiman Marcus and Bergdorf's combined sales fell 10 percent in the same time period, according to Bloomberg's Second Measure, a spending index that tracks consumers' debit- and credit-card use. June also marked the largest sales drop across the three department stores, according to the data, with Saks seeing a 28 percent decrease in sales and Neiman Marcus and Bergdorf declining by 26 percent. Over at Bloomingdale's and Nordstrom, meanwhile, sales rose over 10 percent at both retailers during the same period. In June specifically, Bloomingdale's sales increased by 13 percent, the Second Measure data says. Bloomberg's spending index does have some limits, though. It tracks more debit purchases that credit card transactions; as a result, the info doesn't paint a complete picture of sales at the retailers, since consumers Saks, Neiman Marcus, and Bergdorf use credit cards more frequently compared to other customers, while Bloomingdale's and Nordstrom shoppers often opt for debit cards. Even so, Second Measure is helpful in tracking trends across different retailers. Part of the reason for Saks Global's troubles, in addition to general economic uncertainty, is an increase in order complaints since January, such as damaged packaging and rejected refunds, according to Mary Ross Gilbert, a Bloomberg analyst that studied customer reviews. This has led consumers to look elsewhere for their luxury goods. On top of that, the conglomerate is dealing with some financial woes, recently taking on more debt, in part, to pay off its overdue bills from vendors, who have slowed or even stopped shipments over fears of a lack of payment, Bloomberg reported. Saks isn't alone in its struggles. A trend of declining sales has been popping up across the luxury industry, thanks to looming tariffs in the U.S. and weakened demand in China, among other challenges. LVMH, for one, was below its estimated sales for Q1 this year, Reuters reported, while Gucci saw its sales drop 25 percent in the first three months of 2025, according to Vogue Business. This year's figures come on top of declining numbers at the end of 2024, with Kering (Gucci's parent company), seeing a year-over-year drop of 12 percent. As for Saks Global, things may be on the up and up. For one, the brand's new storefront has been met positively, a spokesperson for the company told Bloomberg. And shipments from vendors are increasing, too, in the wake of new financing, something that Saks says will 'continue as we execute on our plan to begin paying outstanding balances in July,' the spokesperson told the publication. Making those vendors happy will be a key step to putting the retailer back on the right track. Click here to read the full article.
Yahoo
08-07-2025
- Business
- Yahoo
Saks Is Losing Luxury Shoppers in the Wake of Its Neiman Marcus Takeover
Saks Global is going through some growing pains. The parent company of Saks Fifth Avenue bought Neiman Marcus in a $2.7 billion acquisition last year, bringing both department-store behemoths under the same umbrella (along with Bergdorf Goodman). And though the move was meant to unite the luxury titans, the brands have run into some trouble: Consumers are opting to shop at other high-end retailers instead, such as Bloomingdale's and Nordstrom, Bloomberg reported. More from Robb Report This $6.7 Million Ultra-Modern U.K. Home Appeared in the Robert Pattinson Sci-Fi Film 'Mickey 17' Singaporeans Are Splurging Despite a Global Luxury Slump A Modernist Home in Montecito Designed by a Pioneering Architect Just Listed for $18 Million Saks Fifth Ave. saw its sales drop 16 percent year-over-year from the quarter ending June 30, while Neiman Marcus and Bergdorf's combined sales fell 10 percent in the same time period, according to Bloomberg's Second Measure, a spending index that tracks consumers' debit- and credit-card use. June also marked the largest sales drop across the three department stores, according to the data, with Saks seeing a 28 percent decrease in sales and Neiman Marcus and Bergdorf declining by 26 percent. Over at Bloomingdale's and Nordstrom, meanwhile, sales rose over 10 percent at both retailers during the same period. In June specifically, Bloomingdale's sales increased by 13 percent, the Second Measure data says. Bloomberg's spending index does have some limits, though. It tracks more debit purchases that credit card transactions; as a result, the info doesn't paint a complete picture of sales at the retailers, since consumers Saks, Neiman Marcus, and Bergdorf use credit cards more frequently compared to other customers, while Bloomingdale's and Nordstrom shoppers often opt for debit cards. Even so, Second Measure is helpful in tracking trends across different retailers. Part of the reason for Saks Global's troubles, in addition to general economic uncertainty, is an increase in order complaints since January, such as damaged packaging and rejected refunds, according to Mary Ross Gilbert, a Bloomberg analyst that studied customer reviews. This has led consumers to look elsewhere for their luxury goods. On top of that, the conglomerate is dealing with some financial woes, recently taking on more debt, in part, to pay off its overdue bills from vendors, who have slowed or even stopped shipments over fears of a lack of payment, Bloomberg reported. Saks isn't alone in its struggles. A trend of declining sales has been popping up across the luxury industry, thanks to looming tariffs in the U.S. and weakened demand in China, among other challenges. LVMH, for one, was below its estimated sales for Q1 this year, Reuters reported, while Gucci saw its sales drop 25 percent in the first three months of 2025, according to Vogue Business. This year's figures come on top of declining numbers at the end of 2024, with Kering (Gucci's parent company), seeing a year-over-year drop of 12 percent. As for Saks Global, things may be on the up and up. For one, the brand's new storefront has been met positively, a spokesperson for the company told Bloomberg. And shipments from vendors are increasing, too, in the wake of new financing, something that Saks says will 'continue as we execute on our plan to begin paying outstanding balances in July,' the spokesperson told the publication. Making those vendors happy will be a key step to putting the retailer back on the right track. Click here to read the full article. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
New York Times
01-07-2025
- Business
- New York Times
Saks Is at a Crossroads, Facing Creditor and Vendor Unease
Zenobia Taylor-Braun had high hopes in 2021 when she started selling her artisanal jams to Saks Off 5th, the off-price sister brand to Saks Fifth Avenue. For a small-business owner like her, access to the luxury retailer's stores seemed like a prestigious step forward. But Ms. Taylor-Braun's excitement soon gave way to frustration about missed payments. She was forced to hound Saks to pay its invoices, she said, and when she finally received payment, six to eight months later, it was often less than what she was owed. 'We were sold a lot of empty promises,' Ms. Taylor-Braun, who runs Cellar Door Preserves, based in Grand Rapids, Mich., said. She severed ties with Saks last year and wrote off hundreds of dollars in losses. 'It would take quite a bit of convincing for me to ever work with them again,' she said. The Saks brand's ailing relationship with vendors, a problem years in the making, is one of the many challenges shadowing the company as it tries to shore up its finances, re-establish trust with suppliers and convince investors and consumers that a $2.7 billion deal to buy a longtime rival was worthwhile. Six months after Saks acquired Neiman Marcus, the combined company — Saks Global — is trying to assure bondholders that the tie-up they helped fund puts the luxury giant on firmer financial footing. Want all of The Times? Subscribe.
Yahoo
29-06-2025
- Business
- Yahoo
Saks Global Bolsters Its Finances, Secures $600 Million in Commitments
Saks Global has bolstered its finances, securing $600 million in financing commitments from a majority of its existing bondholders, the luxury retailer said Friday. The new financing should help ease concerns among bondholders and vendors that Saks Global would not have the wherewithal to sustain its operations — although the company is working with a $4 billion debt load as it seeks to push through a major reset in its business model. Saks Global includes the Neiman Marcus, Bergdorf Goodman, Saks Fifth Avenue and Saks Off 5th stores and e-commerce businesses. For the year ended Feb. 1, Saks said revenues totaled $3.8 billion. That included about $432 million in sales from Neiman Marcus Group, which was acquired on Dec. 23. Incorporating Neiman's business for the whole year, sales fell 10 percent to $7.3 billion. More from WWD Saks Global Extends Partnership With NuOrder to Neiman Marcus and Bergdorf Goodman Saks Global Report: Intent to Spend on Luxury Softens Saks Said to Pursue Joint Venture to Expand Bergdorf Goodman Saks has a $120 million interest payment due on Monday on its senior secured bonds — the first interest payment on the $2.2 billion in bonds issued just before Saks bought Neiman Marcus Group in December at a $2.7 billion enterprise value. The transaction detailed on Friday includes a $400 million first-in, last-out (FILO) asset-based credit facility, with $300 million funded right away and an additional $100 million to be funded upon completion of a bond exchange. A FILO loan is added to an existing debt structure, where the new lender gets repaid first, even though they provided money after the others. It's considered a quick, efficient way to build incremental liquidity into a business. The transaction also includes $200 million in additional commitments subject to certain conditions. A majority of bondholders have committed to participate in the exchange, which will launch shortly. Marc Metrick, chief executive officer of Saks Global, said in a statement: 'Today's announcement reflects the outcome of productive engagement with our bondholders and their continued confidence in our business and strategic direction. This comprehensive financing package meaningfully enhances our liquidity and strengthens our balance sheet. Coupled with the early realization of synergies and improving inventory position, we are primed to execute on our transformation strategy, invest in key growth initiatives, and reinforce our leadership as the world's largest multi-brand luxury retailer.' Saks said it would be entering into this transaction in lieu of the financing commitments it announced last month with SLR Credit Solutions. Previously, the company said it secured $350 million of financing commitments from SLR, consisting of a $300 million FILO facility. PJT Partners and BofA Securities Inc. are serving as financial advisors to Saks Global in connection with the transaction while Willkie Farr & Gallagher and Kirkland & Ellis are serving as legal counsel. Just last week, Saks Global moved to further integrate its operations, widening the role of Emily Essner, president and chief commercial officer, and promoting Mary McGreevy to chief stores officer for Saks Fifth Avenue and Neiman Marcus. The company has been integrating the Saks Fifth Avenue and Neiman Marcus store teams into one central commercial organization. Bergdorf Goodman remains separate. With the change, all customer-facing functions for Saks Fifth Avenue and Neiman Marcus, including brand partnerships and buying, merchandise planning, marketing, digital, commercial analytics and customer insights — and now store experience as well — will be part of the Saks Global commercial organization, led by Essner. 'We are continuing to execute on our integration strategy, and with that, we are creating a more unified approach in how we serve customers,' Metrick said a week ago. 'By integrating our store teams into the commercial function, we will be better positioned to capitalize on opportunities to better serve our customers, driving growth for our business and that of our brand partners.' Essner reports to Metrick. Through the integrations of its operations, Saks Global, while looking to operate more efficiently and respond to trends and customer needs faster, is seeking to cut about $600 million in annual costs. This spring, approximately 550 workers were terminated, cutting 3 percent of Saks Global's total workforce following reductions made earlier in the year. Another 500 jobs were also eliminated when Saks closed an owned fulfillment center in Tennessee recently. The integrations will help reduce costs. As a result of the integration, Larry Bruce, president of stores for Saks Fifth Avenue and Neiman Marcus, left the company. Saks Global has begun paying its bills to vendors, many of which were left unpaid for many months, though some are still awaiting payments from orders received this year. Unpaid orders from last year Saks has promised to begin paying in monthly installments beginning in July. Best of WWD Macy's Is Closing 66 Stores in 2025 — Here's the List, Live Updates Inside the Demise of Lord & Taylor COVID-19 Spikes Elevate Retail Concerns Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
15-06-2025
- Business
- Yahoo
Fortnum & Mason plots first UK stores outside London
Fortnum & Mason is plotting its first UK stores outside of London after a surge in customer demand for regular top-ups of luxury teas, biscuits and jam. Tom Athron, the chief of the luxury retailer, said he would be interested in opening stores 'up the spine of the country', adding: 'We do like the idea of stepping beyond Piccadilly [where it has its flagship store], and certainly stepping beyond London.' Fortnum & Mason currently only has four UK stores – including at St Pancras station, a 'tea salon' in London and Heathrow Terminal 5, as well as one site in Hong Kong. Opening outside London would mark the first time the Royal grocer has set up a permanent UK base away from the capital in its 318-year-history. Mr Athron did not say where a new Fortnums could open – but said he would look at sites in a 'beautiful location' with 'beautiful architecture'. He suggested Fortnum would probably consider opening one or two outposts, adding: 'This isn't about ubiquity. But there are other locations across the country where we think that Fortnum could offer both retail and restaurants, where it would be relevant. And we're looking at those now.' It comes as the retailer said it was no longer seen as a 'Christmas focused' business, with customers using Fortnum & Mason to 'stock their own larders' throughout the year. Fortnum & Mason earlier this month launched a new membership scheme – with those signing up to the 'Friends of Fortnum's' programme getting access to tickets for dining events as well as free delivery. Mr Athron said any new store away from London would 'remove the barriers' for the membership scheme and allow members to attend these events. Fortnum & Mason will also look at opportunities to open more airport stores, with Mr Athron saying: 'We would love the opportunity to have shops and restaurants in every terminal at Heathrow.' The plans come despite signs that households are slamming the brakes on spending, amid concerns over the economy. Figures from the British Retail Consortium last week suggested retail sales rose by just 1pc in the year to May. Mr Athron said Fortnum was not seeing a drop in demand. He said: 'What we tend to find is that when people become more judicious in the way that they spend their money, they switch out handbags and trainers for small luxuries they can take home – things like a really special jar of jam.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
