Saks Global is doing its best to mend fences with its vendors.
The retailer that encompasses Saks Fifth Avenue, Neiman Marcus and Bergdorf Goodman is hosting an event at Pitti Uomo on Wednesday to outline its menswear strategy to the vendor community and press.
The team, led by Emily Essner, Saks Global president and chief commercial officer, and Paolo Riva, chief brand partnerships and buying officer for Saks and Neiman’s, will join Joo Woo, the newly named senior vice president of brand partnerships and buying for men’s, and Bruce Pask, senior director of men’s fashion, at Pitti to lay out the company’s go-forward plan.
In a preview with WWD, the team said it views menswear as its next great growth opportunity.
Some 22 percent of Saks Global customers shop menswear, they said, and they are younger than the average shopper, with higher incomes. Overall, the company holds about a 50 percent share of the men’s luxury market among multibrand retailers in the U.S.
To appeal to this customer, the company is leaning into what Riva described as “the new uniform,” which is a wardrobe that is more casual than in the past. “The occasions have not necessarily changed, but the attire within the different occasions has changed and is much broader and flexible,” he said.
Men today are more willing to take risks in their wardrobe choices, he continued, but are also seeking “craftsmanship” and “timeless items.”
In order to service both the existing, more-sartorial shopper, as well as a fashion-forward shopper, Riva said Saks Global will offer “a better representation of the menswear world through multiple brands and multiple categories,” supported by marketing that will “educate men on wardrobing and build their confidence.”
He added that the men’s team is “looking at various price points and a brand mix that will feel surprising and exciting for this customer,” one that is “complementary to our hero brands today.” Although he declined to mention names, he said Saks Global sees an “opportunity for us to develop that entry to the designer world to add to our sartorial assortment.”
Essner said six months after the completion of the merger, Saks Global became the largest multibrand luxury retailer in the world with 70 stores and access to 30 million high-worth customers, mainly in the U.S.
Although about one-third of the business, or $3 billion, is done online, the vast majority of sales still come from brick-and-mortar, she said, where the company’s 3,400 stylists — nearly half of which have $1 million books — work with clients. And enhancing this personal service remains “a huge priority for us,” she said.
The menswear customer, they said, has a greater preference for in-store shopping and tends to seek out advice from sales associates. “They really value the expertise and guidance of our associates,” Riva said.
The team said that while the customer overlap between Saks and Neiman’s is “relatively low,” there’s still a lot of brand overlap, but they believe there is “room to maintain different positionings” at the two chains, according to Essner.
She also addressed the “brand mix rationalization strategy,” which involves a significant reduction in the number of brands that will be carried within the stores. Richard Baker, Saks Global’s executive chairman, said some 500 to 600 brands, or 25 percent of the total, would be cut from the mix because they did not meet volume expectations.
She said the reduction will have “a very minimal impact on our top-line sales. At the end of the day, we’re making sure that we are more intentional in driving business and growth and brand awareness for the brands that will be with us moving forward — creating more real estate opportunities, creating more financial opportunities through investment, creating more digital real estate opportunities.”
But even those vendors that are likely to still be in the mix remain wary.
Even before the $2.7 billion merger was completed last year, Saks’ vendor payments had been delayed for some time. The retailer subsequently agreed to start cutting checks on merchandise that had already been delivered in past seasons this July, but also instituted 90-day payment terms on new orders.
Not surprisingly, that didn’t go over well with vendors.
Although the retailer did pay its largest designer brands first, it was the smaller and medium-sized vendors — who could least afford the delay — who were hurt the most.
Just in the past few weeks, as reported, some of the smaller brands also started to get checks, softening their stance about the retailer.
Essner said Saks Global is “in this for the long haul. There’s been a fair bit of noise on us the last few months, but we’ve got great momentum. The work that we’ve done around payments has been noisy and challenging. But we have been making good on the payment plans that we have agreed to, and at this point, the vast majority of our brand partners have agreed to that 90-day timing. There’s work to be done on both sides to create a luxury retail industry in the United States that works better, and we are ahead of our synergy targets for the year, which helps us be a more-sustainable business, which in turn, serves our partners as well as our customers.”