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Saks’ High Note: Off 5th Rolling Out

Saks Inc. announced it will open three additional Off 5th units, another sign that the off-price sector is a bright spot in the otherwise dim retail industry.

Saks Inc. said Tuesday it will open three additional Off 5th units, another sign that the off-price sector is a bright spot in the otherwise dim retail industry.

The Off 5th units will launch at the Legends at Sparks Marina in Reno-Sparks, Nev., in May; in Cincinnati Premium Outlets in Monroe, Ohio, in August 2009, and in the Grand Prairie Prime Outlets in Grand Prairie, a suburb of Dallas, in November 2009. Each store will be 28,000 square feet.

The company previously announced Off 5th openings in The Arches at Deer Park in Deer Park on Long Island in October and in Prime Outlets in St. Augustine, Fla., and Rio Grande Valley Premium Outlets in Mercedes, Tex., in November.

All of the stores will be designed to reflect the 26,400-square-foot prototype outlet that opened in Orlando’s Prime Outlets International Center in April.

“The prototype store is very innovative, modern and open,” said Robert Wallstrom, president of Off 5th. “The response to the new store design has been very positive.

“Each of the new stores will be located in premier outlet centers and complemented by a variety of other luxury and designer stores.”

Wallstrom described the format as an uncluttered, flexible loft environment that makes shopping easy. There is one hardwood surface throughout and fixtures are on casters, so there’s flexibility in the merchandising and easier movement through the store. The goal is to better project the upscale image of Saks Fifth Avenue. Older outlets have a lot of small rooms and different floor surfaces.

Off 5th operates about 50 units, and last year generated volume of just under $400 million. Discounts start at 30 percent, but go as high as 90 percent on clearance goods.

Between 80 and 90 percent of the labels found in Off 5th are the same as those found in the Saks Fifth Avenue regular-priced stores; 10 to 20 percent are brands not carried at Saks and could be from competitors. The outlets also sell some private label.

Off 5th resumed its expansion this year, and was last in expansion mode in the mid-Nineties until around 2000. The majority of stores are in outlet centers, while some are in strip centers and mixed-use centers. The new prototype is also suitable for lifestyle centers.