DepartmentStores

Lack of Supply And Increased Demand Frustrating Some Shoppers

Last year many stores found themselves stuck with too much inventory and not enough buyers. The resulting fallout led to a series of deep sales and a firm resolve not to let that happen again. This year we are seeing the reverse situation, shoppers with money who are finding less inventory to splurge on. Bloomberg has an interesting piece that suggests that luxury department stores, which have cut back on their orders in order to cope with declining sales, may end up losing customers who are frustrated with the lack of selection.

Retailers aren't exactly itching to stuff their stores. They aren't convinced that the shoppers are ready to storm the doors in droves and are still licking their wounds over the last year's discount days which led to reduced profits all around. They are also hoping that a little lack of supply will stimulate demand and get shoppers in when lines first arrive rather than waiting for discounts. Store executives have to order months in advance and last year's debacle has spooked some strategists. Some analysts suggest that the first stores to go back to the good old days of stuffed aisles may have a leg up on their competition.

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Tags: department stores, DepartmentStores, shopping

Department Stores Stock The Aisles With Fewer Items

by Deidre Woollard (RSS feed) —

For those still out shopping last winter, department stores represented a rare opportunity, tons of inventory marked deeply down. Don't expect that magic to happen again. More and more stores are announcing that they are reducing inventory so as not to be left holding the bag if shoppers fail to show up. Saks CEO, Stephen Sadove tells Bloomberg that "across the board you are going to find less of the sizes, less of the availability in almost all of the categories." He also says that markdowns won't be as dramatic as they were last year. While in previous years the buzzword was "masstige" offering luxury for everyone now Sadove says that "luxury has always been about scarcity."

The ripple effect of department stores cutting back inventory has already made it increasingly hard for some designer labels to survive. Neiman Marcus and Saks have both said they are cutting back on lines that don't sell well and linger on the racks. And the recession also seems to be stifling creativity a bit. Stores are looking for staples, classics and safe bets to stock their stores. The avant-garde, trendy and daring is too risky if there are fears that it won't sell. Brands are making one or two versions of a particular style rather than a wider range. Retail sales are expected to rise slightly by the end of this year but it won't be enough to make up for last year's sharp losses.

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Tags: department stores, DepartmentStores, luxury, saks fifth avenue, SaksFifthAvenue, stores

Saks Discounts Spring Clothes, Will Anyone Care?

by Deidre Woollard (RSS feed) —

We've seen it for years, the rapid-fire rush through the seasons. We no sooner say goodbye to one holiday than the next one is already being pushed at us in retail stores. But now that the economic slowdown has created a logjam in the process of rapid acquisition and dispersion, the stores have a problem. How do they get the merchandise out?

The obvious answer is sales and as Fashion Week Daily reports Saks Fifth Avenue is already selling Spring 2009 merchandise at 40 percent off and Barneys is set to follow suit next week. The depth of the discount is no surprise. Since the screech-to-a-stop holiday season last year department stores have been sawing away at prices to keep people shopping. In fact, at this point one has to wonder if 40 percent is even enough to get people excited. NY Mag's The Cut said, "call us when they hit 75 percent." The bright spot for stores is that they were better prepared for Spring 09 than they were for Fall/Winter 08 so there is less inventory to get rid of which does mean the discounts probably won't run as deep.

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Tags: department stores, DepartmentStores, saks fifth avenue, SaksFifthAvenue, sales

Harrods to Expand Private Label Offerings

by Jared Paul Stern (RSS feed) —

Famed deluxe London department store Harrods, owned by the late Dodi Fayed's financier father Mohamed Al-Fayed, just announced plans to expand its private label product lines to put them on a par with the famous name merchandise it has long carried. Harrods branded products will soon include everything from golf and ski accessories to baby wear and plus-size collections, Vogue UK reports. The million square foot store, located in Knightsbridge, is the largest and one of the most luxurious in the world. It holds several royal warrants from the likes of the Queen, the Queen Mother and the Prince of Wales.

Tags: Department Stores, DepartmentStores, Harrods, London, Mohamed Al-Fayed, MohamedAl-fayed, Prince Charles, PrinceCharles, Queen of England, QueenOfEngland, Royal warrant, RoyalWarrant