Neiman Marcus streamlining; getting out of the outlet store business
Neiman Marcus Group is sharpening its focus on its core business: selling full-price luxury goods.
The retailer announced that, as part of its four-year “transformation growth plan,” it is closing the majority of its 22 Last Call outlet stores before the beginning of its next fiscal year, which starts in early August. Select Last Call locations will remain open to serve as a selling channel for Neiman Marcus residual inventory.
The retailer said the move will allow it to focus on serving its core high-value luxury customers and free up resources to invest in Neiman Marcus and Bergdorf Goodman. The company expects to eliminate approximately 500 roles in the Last Call organization during the next eight months.
Some of the affected associates will be placed in other roles while others will be eligible for severance, outplacement services and also have an opportunity to apply for other open positions within the company.
Neiman’s is also letting go of approximately 250 non-selling associates across all stores. Multiple new roles will be created to prioritize the focus on team and client development.
“This is not a workforce reduction,” van Raemdonck told WWD. “This is not a reaction to anything happening in the economy now. It’s a strategic decision to redeploy resources.”
In addition, the retailer has started the process to sell two distribution centers in Texas (in Longview, and Las Colinas). The proceeds will be reinvested in the company’s supply chain to ensure that Neiman’s “remains on the cutting edge of product distribution,” resulting in an on average four to five-day speed-to-market improvement.
Neiman’s transformative strategy also includes shifting the role of store associates to “trusted client advisors” who will be equipped with digital clienteling tools. The NM Connect app has been in test mode since January with digital stylists, according to WWD, and will be rolled out to associates in all stores beginning late March through the end of the year.
And to ensure a consistent experience across channels, further “seamless” experiences across channels, David Goubert is expanding his role as chief retail officer. Previously, he oversaw store teams. He will now oversee both store and online teams.
"We are making purposeful decisions as we continue to transform NMG into a business that drives accelerated profitable and sustainable growth,” said Geoffroy van Raemdonck, CEO, Neiman Marcus Group. “We are building a solid luxury customer base and taking deliberate steps today to align Neiman Marcus' in-store and online teams, revisiting how we deploy our resources by investing in our supply chain, and streamlining Last Call."
Neiman Marcus Group operates 43 Neiman’s stores, 22 Last Call outlets and two Bergdorf Goodman stores along with several e-commerce sites and the Horchow direct-to-consumer business.