Saks Fifth Avenue (New York) is reportedly about to announce the return of its once-profitable private label collection, to be called Saks Fifth Avenue Private Collections.
The previous in-house clothing label, Real Clothes, had been introduced in 1985 as a line of affordable, casual apparel for women. It grew into a $60 million business before then-ceo Fred Wilson abruptly dropped it last year, saying the line did not fit into his vision of Saks as a luxury retailer that appealed to the young, fashion-hungry consumer.
The decision to reintroduce a private label line appears to have been made by Stephen Sadove, the new ceo of Saks Inc. (Birmingham, Ala.), who is attempting to return profitability and higher margins to the luxury retail chain. In 2005, Saks' profit margin was 0.6 percent, compared with profit margins of 6.5 percent at Neiman Marcus. In an interview shortly after he became chief executive, Sadove said Saks had not failed to match the merchandise at Neiman Marcus but, instead, had failed to contain costs. Rather, he has said, the performance gap is productivity per store and profitability.
According to a report in this morning's New York Times, the store-brand clothing lines, the first of which are to reach stores in August, offer an early glimpse into Sadove's turnaround strategy. The Times said Sadove is trying to court the 35-to-55-year-old Saks customers who became alienated by Wilson's emphasis on younger, urban, skin-baring fashions during his three years in charge. He was relieved of his job as part of a management restructuring in January.
There are said to be three clothing lines within the Saks Fifth Avenue Private Collections: Signature (modern career wear, from $250 to $700), Classic (updated sportswear, with an emphasis on knits, from $178 to $1,000) and Sports (relaxed separates, including yoga wear and T-shirts, from $98 to $350). Signature, the first of the new private-label Saks lines to reach stores, features three distinct looks – “regal Victorian,” inspired by British menswear, with woolen fabrics and colors like plum and lavender; “urban sophisticate,” taking its cue from the tuxedo, with poplin ruffled blouses and plaid suits, and “majestic elegance,” a bit more glamorous, with embroidered taffeta skirts and silk chiffon blouses in dark blue. Classic and Sports are to reach stores in November.