Saks Fifth Avenue Enterprises, the New York-based specialty division of Saks Inc. (Birmingham, Ala.) has announced plans to close eight underperforming Saks Fifth Avenue stores and three Off 5th stores.
“After completing an extensive review of our store base, we are taking steps to rationalize our real estate portfolio to improve profitability,” says Fred Wilson, chairman and ceo of Saks Fifth Avenue Enterprises. “(The stores being closed) represent approximately 7 percent of SFAE's square footage but less than 4 percent of its revenues. These actions will permit our team to focus capital, inventory and other resources on our most productive units and will further strengthen our brand.”
Slated to close in January 2005 are Saks Fifth Avenue stores in Carmel, Calif., Garden City, N.Y., La Jolla, Calif., and Pasadena, Calif. Closing dates have not yet been set for the Saks stores in Fort Worth, Texas, Mission Viejo, Calif., and Palos Verdes, Calif. One other closed Saks store — in Hilton Head, S.C. — will be closed and converted to an Off 5th outlet in January 2005.
Meantime, the Off 5th store in Worcester, Mass., will close this month, and the Off 5th outlets in Grove City, Pa., and Nashville, Tenn., will close in January 2005.
These actions will leave the retailer with 56 Saks Fifth Avenue stores and 52 Off 5th stores. Saks estimates about 700 workers will be affected by the closings. Those employees will either be offered transfer opportunities or receive severance packages.