Saks, the retailer that helped create the deep-discounting trend last fall, is seeing more shifts in its business. The luxury retailer has begun altering its mix downmarket in order to carry products with more budget-minded appeal. It is also expanding its Off Fifth outlet stores and producing more merchandise to sell directly via outlets.
Saks Chief Executive Officer Stephen Sadove, noting "an evolution of what the consumer wants," is moving to more value-oriented merchandise, including budget lines from high-end brands. While the specialty retailer holds out hope that exclusive, high-end items will still sell, Saks is acknowledging the changes present.
Update: Scrolling through department store archive news, this development is happening in similar ways at Saks' competition. Nordstrom is lowering prices in order to accommodate new shopping patterns, although it's compensating by raising its credit-card interest rates. And Neiman Marcus is encouraging its designers and buyers to look for value as they prepare collections this year. Neiman, similar to Nordstrom, is hoping to keep shoppers at full price, just on lower-ticket items for now. Said a Neiman VP, "We have to get the customer to buy [at] full-price ... [so] you won't get this discounting nonsense."
