Saks Global expects to wrap up its bankruptcy proceedings sometime this summer and has secured $500 million in exit financing for when it does, the luxury department store company said Thursday.
Vendors are increasingly on board, as more than 650 brands have resumed shipping merchandise, releasing $1.5 billion in retail receipts, the company said. This is up from 500 in early March and means Saks Global has the vast bulk of the inventory expected for Q1.
March inventory receipts were up 18% compared to a year ago, when many vendors were jumping ship because of overdue bills and a delayed-payment scheme — a situation that dragged down sales and arguably forged the path to Chapter 11.
The influx of merchandise is boosting engagement, with customer spend up 6% per store visit, online conversion up 11% and “significant improvements in full-price selling across Saks Global's luxury retail banners since the filing compared to the same period last year.”
Saks Global includes Saks Fifth Avenue, Neiman Marcus and Bergdorf Goodman and an off-price business that has been scaled back during the bankruptcy process. Two dozen full-line stores, mostly Saks Fifth Avenue locations, are also slated to close. On Thursday Saks Global described this as “an optimized store footprint of the best-performing locations in markets with a high concentration of luxury customers.”
Saks Global CEO Geoffroy van Raemdonck said the scale of the exit financing reflects progress in a short period of time and confidence on the part of the company’s capital partners.
"As we advance the restructuring process and position Saks Global for the future, our focus remains on strengthening our brand partner relationships, and delivering an expertly curated product assortment and personalized service for our luxury customers across Saks Fifth Avenue, Neiman Marcus and Bergdorf Goodman,” he said in a statement.
