ATLANTA — Saks Fifth Avenue has a new blueprint, and chief executive officer Stephen Sadove is ready to build it.
Sadove, presiding over his first shareholders meeting since becoming Saks Inc. ceo in January, said here on Wednesday that the retailer will target a core customer who is 45 to 48 years old, seek to boost the performance of regional stores and renovate existing units, build relationships with key vendors and add new designers and more accessible luxury.
He reiterated plans to aggressively roll out private label after exiting the business a year ago.
And any doubt that Saks Inc. is Sadove's company was erased when chairman R. Brad Martin took a lower profile than at previous shareholder gatherings, only introducing Sadove, who succeeded Martin as ceo after having served as vice chairman and chief operating officer.
In a postmortem on how the $2.7 billion SFA stumbled, Sadove said, "We focused too much on young, edgy customers, with too much marketing, too fast and too soon. We will keep attracting young customers, but not at the exclusion of our core base."
Sadove told about 50 people during the hour-long session at The Ritz-Carlton in the Buckhead section here that new initiatives are helping the company get back on track.
Responding to pointed questions from shareholders about the time line for a turnaround, when they would see more return on investment and an improved stock price, Sadove said he was focused on improving sales performance and on bringing the current 2 percent operating margin to 8 percent in the next three to four years, and higher after that.
The presentation came as SFA revealed plans for its fall print advertising campaign and less than a week after the retailer said it would take a three-pronged approach to reinvigorate private label, introducing the Saks Fifth Avenue Signature collection in early August, the Saks Fifth Avenue Classic in November and, later, Saks Fifth Avenue Sport collection.
Sadove said Saks' core customer base, with an average age of 48, and new customers, who average 44 years old, are the retailer's primary target as it competes with Neiman Marcus as well as Nordstrom and Bloomingdale's. Only 17 percent of new customers are 25 to 35. For that base, Saks will focus on important vendors, including Armani, Chanel and St. John, and showcase new designers.
A Stella McCartney sketch of a custom dress made from protein-based silk in partnership with biotech lab Bolt Threads. The dress will be displayed at The Museum of Modern Art's upcoming design exhibition, "Items: Is Fashion Modern?"