PRADA CUTS BERGDORF’S, FOCUSES ON OWN UNITS

Byline: Sharon Edelson

NEW YORK — Prada continues to hone its distribution.
The latest retailer to be dropped by the Milan-based fashion house is Bergdorf Goodman, a Prada spokeswoman confirmed Monday.
As Prada expands its retail business, the company has been tightening distribution to channel more sales through its own stores.
As reported, Prada plans to open a 20,000-square-foot store at 724 Fifth Avenue between 56th and 57th Streets next spring, one block south of Bergdorf’s, on the same side of the street.
“We will be selling footwear [at Bergdorf’s] only for spring/summer ’98,” a Prada spokeswoman said. “Ready-to-wear and handbags will be gone.”
Bergdorf’s, one of the premier luxury retailers in the country, reportedly does a big business in Prada handbags and accessories.
The store sells Prada shoes on the second floor and opened a rtw boutique for Prada on the third floor.
That leaves Barneys New York as the last retailer here to sell Prada outside the company’s own network of stores.
“For now, we’re selling Barneys and will continue to work with Barneys,” the Prada spokeswoman said.
“Prada is opening their own stores and cutting out distribution from other stores,” said Bonnie Pressman, executive vice president of Barneys. “It’s frustrating; it’s definitely frustrating. They cut distribution from a couple of our mall locations.
“They are saying they will sell to us after they open Fifth Avenue,” Pressman said. “Not everybody in America is used to shopping in boutiques. Some people like a slightly bigger store and selection. They’ll figure out down the road if they need to expand their distribution again.”
In addition to its upcoming store on Fifth Avenue, Prada has two other Manhattan locations. It opened an 18,000-square-foot flagship on Madison Avenue at 70th Street in October 1996, and operates a small unit on East 57th Street between Madison and Park Avenues.
The expansion has caused some experts to ask, “How much is too much?” But Prada, which has seen unprecedented demand for its product in recent years, is projecting $620 million in wholesale volume in 1998, more than double the $300 million it registered in 1996.
Prada pulled out of Linda Dresner, the Park Avenue boutique, last spring.
“It has become a problem,” Dresner said, referring to designers opening their own stores. “Prada has grown and is no longer available to us. They have already said they won’t sell to us. Prada has always has been a very good product for us, so we miss it in New York and have had to substitute for those collections that are no longer available.”
“Our own retail business is going to increase over the next two years, while the wholesale accounts will decrease,” the Prada spokeswoman added, noting Prada plans to trim the number of independent retail and department store doors carrying the brand from 502 to 465 in 1998.
Prada’s plan to build flagships in other cities raises the question of whether the company will continue to sell retailers in close proximity to its stores. For now, Prada is not saying if it will make any changes.
In Chicago, Prada bought a five-floor, 12,850-square-foot building at 30 East Oaks Street. The company is renovating the space and expects to open in August 1998.
Prada also purchased a six-story, 24,000-square-foot building on Post Street in San Francisco. Prada opened its first store in Dallas in September, and this month opened a 6400-square-foot unit at the Americana Shopping Center in Manhasset, N.Y.
Janet Brown, who owns an eponymous store in Port Washington, N.Y., carries Prada, but hopes there won’t be a lasting impact.
“Does Prada opening in Manhasset affect me?” she asked. “Of course. But it also can make me look better. If a new shop like Prada has opened, of course customers are going to go and look. But I think it will make them appreciate the small boutique even more. We have wonderful collections, service and alterations.”

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