Saks Fifth Avenue is closing its store in Southampton, N.Y., on Saturday as part of the retailer’s intensified program to weed out weak units over the past year.
This story first appeared in the October 6, 2010 issue of WWD. Subscribe Today.
So far this year, the firm has closed its Saks Fifth Avenue stores in San Diego; Charleston, S.C.; Plano, Tex., and the separate men’s and women’s units in Portland, Ore., and the Saks Fifth Avenue store in Mission Viejo, Calif., is closing later this month.
In addition, Saks disclosed that its Off 5th outlet in The Legends at Sparks Marina in Sparks, Nev., will close on Jan. 1.
“We routinely review the productivity, profitability and potential for each of our stores and may determine it is appropriate to close a store from time to time,” Stephen I. Sadove, chairman and chief executive officer of Saks Inc., said Tuesday. “Store closing decisions are difficult ones to make, but the planned closing of these two locations is consistent with our strategy of deploying our resources in productive stores and closing underperforming stores, when feasible.”
About 35 associates are employed in the Southampton store, and 20 associates are employed in the Reno Off 5th location. Saks said the employees will be offered transfer opportunities or severance packages.
The Southampton store is Saks’ smallest location at about 15,000 square feet. The Off 5th unit in Sparks is 28,000 square feet. Saks Inc. operates 49 Saks Fifth Avenue stores, 56 Off 5th stores and saks.com.
Sadove was not available Tuesday to update the outlook on future closings, but last August during a conference call revolving around second-quarter results, Sadove said, “I don’t think you are going to see lots more. There could be another one or two maybe [this year] but I’m not going to commit to that. We expect at most only a few more potential Saks Fifth Avenue closings.”
Julia Bentley, senior vice president of investor relations and communications, on Tuesday cited the size of the Southampton unit as contributing to its closing. “It is very difficult to represent the Saks Fifth Avenue brand in such a small space.” Asked about future Saks closings, Bentley replied, “We do not expect a large number of additional Saks Fifth Avenue store closings by any means.”