Saks Global CEO Marc Metrick told analysts this week that the luxury department store group has stabilised its relationships with vendors and has no plans to close stores, signalling confidence in the company’s direction following a turbulent start to the year.
In a meeting with BMO Capital Markets, Metrick confirmed the group had made progress on overdue payments and secured vendor support for its updated payment terms.
Analysts described the tone as upbeat, noting that Saks Global appears to be firmly committed to its existing store footprint, which includes 33 Saks Fifth Avenue locations, 86 Saks Off 5th stores, 36 Neiman Marcus stores, five Neiman Marcus Last Call outlets, and the flagship Bergdorf Goodman in Manhattan.
The future of the Neiman Marcus store in downtown Dallas remains unclear. Earlier this year, Saks Global had planned to shut the store by March 31, only to reverse course following pressure from local officials, agreeing instead to operate it through the 2025 holiday season.
The company has not confirmed if it will stay open beyond that.
Earlier reports of vendor tensions stemmed from late payments, raising doubts over Saks’ liquidity position. A revised payment plan, though unconventional, was accepted by most suppliers, Metrick told BMO.
That, combined with $350 million in new financing commitments, has reportedly helped Saks bolster its inventory plans ahead of the crucial holiday period.
BMO analysts said the company now appears to have a firmer grip on its operations, estimating Saks will achieve $285 million in run-rate synergies by the end of this fiscal year, on track to hit $600 million over five years, up from an initial target of $500 million.
Metrick expressed confidence in both the company’s liquidity and the broader luxury market, despite macroeconomic headwinds.
He acknowledged consumer uncertainty but pointed to Saks research showing that high-income customers, particularly those earning over $200,000, remain relatively confident in their personal finances, even if they’re more wary about the wider economy and political climate.
Still, not all observers are convinced. A separate report from HSBC Global Research cited concerns among luxury brand managers in New York, particularly around Saks Global’s financial outlook and ongoing US tariff risks.
However, Saks appears to believe that affluent consumers remain resilient. While tariffs and higher prices haven’t emerged as top concerns among its customers, Saks expects modest price hikes, in the high single digits, will be sufficient to absorb the impact of increased import duties.
Roughly 80% of Saks’ merchandise is sourced from Europe, BMO noted.
Despite recent challenges, Metrick remains bullish on the company’s long-term prospects. “While acknowledging macro volatility,” BMO’s Simeon Siegel wrote in a note, “Metrick expressed clear excitement and confidence in his long-term business opportunities.”
Click here to sign up to Retail Gazette‘s free daily email newsletter
