The parent company of Saks Fifth Avenue, Neiman Marcus and Bergdorf Goodman filed for bankruptcy protection Wednesday, marking a watershed moment for the nation’s largest luxury department store group.
At the same time, Saks Global announced it has secured $1.75 billion in financing, and appointed Geoffroy van Raemdonck as its CEO, effective immediately, according to a company announcement.
The filing is yet another grim milestone for the American department store, which has seen contraction in the 21st century due to the popularity of Internet shopping and other factors.
What will this mean for shoppers?
Nothing, right now. In announcing the filing, Saks stated that “stores and ecommerce experiences across Saks Fifth Avenue, Neiman Marcus, Bergdorf Goodman, Saks OFF 5TH, Last Call and Horchow are open to provide customers with exceptional products, elevated luxury experiences and highly personalized service.”
But that’s likely to change. As The Wall Street Journal reported, the company will probably emerge with fewer stores, though the luxury store banners and the brands they sell will likely endure.
The company alluded to this, saying it is “evaluating its operational footprint to invest resources where it has the greatest long-term potential.”
There are roughly 33 Saks stores and 36 Neiman Marcus locations, two Bergdorf Goodman stores and about 70 Saks Off 5th discount stores.
But that process usually doesn’t begin until about 30 days after the filing, according to The New York Times.
Saks Fifth Avenue currently has one store in Alabama, at Birmingham’s The Summit.
One footnote in Birmingham business history – the Magic City was Saks’ headquarters following a 1998 merger with Knoxville-based department store chain Proffitt’s Inc.
The marriage came apart in the mid-2000s, as Saks sold Proffitt’s and other mid-level department stores, including Birmingham’s Parisian, to Charlotte-based Belk Inc. The Saks headquarters was then moved to New York in 2007.