Neiman Marcus Will Not Be Coming to Canada
Neiman Marcus CEO Karen Katz has addressed speculation that her company will open stores in Canada. Readers may recall that Neiman Marcus was bought by The Canada Pension Plan Investment Board and Ares Management in September 2013. Given the Canadian connection, some questioned if Neiman Marcus would open store locations in countries other than the United States. Until now, it was unclear what direction Neiman Marcus would take post-purchase.
Ms. Katz discussed her company’s expansion plans in Dallas during a speech given at the Weitzman Group‘s annual retail forecast on Wednesday, January 8th. During her speech, Ms. Katz revealed that her company plans to focus on its online business and “slow” domestic growth, and that it will bypass plans for Canada, at least for now.
Some may be disappointed to learn this, though Canada’s luxury retail market is about to become substantially more crowded with the introduction of upscale American retailers such as Saks Fifth Avenue and Nordstrom.
Dallas-based Neiman Marcus has over 40 full-sized American department stores, including several productive flagships of over 200,000 square feet. It also owns New York City’s 316,000 square footBergdorf Goodman store. Neiman Marcus stores are typically in the 100,000-150,000 square foot range and the company is considered to be a premier luxury store.
Regarding international expansion, Ms. Katz said: “My greatest dream would be to have a few stores across the world, but it would be very difficult to envision that over the short term. That would be the hardest thing that we could ever try to pull off.”
Neiman Marcus will instead focus on its $1-billion-a-year (and growing) e-commerce business, which now accounts for about 22% of its sales. Interestingly, Ms. Katz says that the customer who shops both online and in-store spends four times as much as a “single-channel shopper”, who only shops either online or in-store. Neiman Marcus will also concentrate on its ‘Last Call’ discount chain as well as its lower-priced ‘Cusp’ stores as part of its domestic growth strategy.