FRASCH IS BACK, WINS PLUM SPOT AT BERGDORF HELM

Byline: David Moin

NEW YORK — After a rough ride at GFT USA, Ron Frasch has bounced back, landing the top job at Bergdorf Goodman.
On Wednesday, Bergdorf’s named Frasch chairman and chief executive officer, succeeding Stephen Elkin, who left in January to become ceo of Fashion500.com, a designer business-to-business and business-to-consumer Internet company under development.
Frasch, who started working at Bergdorf’s on Wednesday, reports to Burt Tansky, president and chief operating officer of its parent, the Neiman Marcus Group. Among the Bergdorf Goodman executives reporting to Frasch is Peter Rizzo, who is president and in charge of merchandising.
Rizzo and a number of outside executives had been considered for the ceo slot. Rizzo, however, does not have any experience at the helm of an organization, while Frasch has had a few stints in leadership roles. And, unlike Rizzo, Frasch has had a long career in women’s merchandising. Frasch was president of GFT USA from July 1996 until last month. He declined to discuss his experience at GFT in detail, but did acknowledge, “It was a tough place to work. There were changes in direction.”
Frasch’s decision to leave was personal, according to sources, but could have been precipitated by a restructuring of GFT’s global operations that put more power in the Italian headquarters. The structure had GFT’s designer licensors — which include Giorgio Armani, Calvin Klein, Antonio Fusco and Joseph Abboud — working closely with global sourcing teams to track the production and pricing of their collections.
While this was supposed to create more efficient economies of scale over the long term, the moves weakened GFT USA’s position, making it more of a coordinator and less of a manager in the corporation. At the time the restructuring was announced last December, it was widely speculated that Frasch would leave.
Before GFT, he was president and ceo of Escada USA, from February 1994 to June 1996. Prior to that, he was at the Neiman Marcus chain from 1984 to 1994, rising to senior vice president and general merchandise manager and making his mark in the luxury sector, building the store’s designer and bridge businesses.
Rizzo continues as chief merchant, but Frasch is expected to play an important role in the women’s business as well as in administration and operations. Bergdorf’s annual volume is about $275 million.
“This is a very positive step toward strengthening the team at Bergdorf Goodman,” Tansky told WWD Wednesday. Tansky stressed that Frasch’s appointment reflected the corporation’s intent to maintain Bergdorf’s buying and merchandising team and strategy separate from those of its sister company, Neiman Marcus Stores.
The back-office operations of Bergdorf have already been merged into to those of Neiman’s, based in Dallas. When asked if the corporation would maintain two separate buying teams, Tansky replied, “Yes, yes, yes.”
The move is an obvious disappointment for Rizzo, who had made no secret of his desire for the ceo job. Rizzo joined Bergdorf’s last April and had a bumpy beginning. He’s got an aggressive management style and his appointment seemed to trigger some high-level turnover. Besides Elkin, among those leaving were Rick Rector, who was senior vice president and general merchandise manager of women’s; Dawn Mello, formerly president, who started her own consulting firm; Joseph Boitano, executive vice president, who joined Saks Fifth Avenue; Mallory Andrews, vice president for publicity, who joined Sotheby’s; Vicki Haupt, a senior vice president who joined Prescriptives, and Linda Francis, a divisional merchandise manager who also joined Saks.
But Rizzo is considered among the sharpest merchants in the upscale apparel business, particularly in men’s wear, and is credited with putting together a strong spring season for Bergdorf’s with a renewed focus on contemporary and advanced collections. Rizzo acknowledged that some key slots in women’s still needed to be filled. “We’ll take our time filling those positions,” he said.
The store apparently is getting back on track following a period of high turnover and some up-and-down seasonal performances, some of which have been attributed to traffic disruption caused by renovation. Bergdorf’s main women’s store is being redone, top to bottom. Last year, a new beauty floor opened and this year, the focus is on completing the renovation of the main floor to provide an expanded accessories, handbags and jewelry presentation. Beauty was previously on the main floor. A restaurant is scheduled to open in June on the lower level.
Frasch declined to be specific about any plans he may have for the store. He did say he would undertake “a review of where the biggest opportunities are. There’s a lot of growth potential at this store. It’s the most renowned fashion specialty store in the world. We wanted to live up to that reputation.”
In the days ahead, Frasch said he would be learning about the organization, the strengths of the store and the customer base. Then he will devise and implement a plan for the future. Frasch will be challenged to rebuild Bergdorf Goodman into the city’s top fashion store, a position it held in the Eighties and early Nineties. It still has a strong and loyal following of affluent customers, but needs to find a stronger voice with a younger and hipper crowd without becoming another Barneys New York.
Now, though, no single store can claim the title of top fashion emporium. Barneys, Saks Fifth Avenue and Bloomingdale’s, and Madison Avenue and SoHo designer shops have been increasingly competitive. While Bergdorf’s and the Neiman Marcus Group have had a string of strong monthly sales reports, Bergdorf’s has been criticized in the last few years for not being as quick to latch on to emerging fashion trends and not broadening its customer base to bring in new and younger consumers. The turnovers didn’t help.During the last several months, there was speculation that Frasch would leave GFT and that he was vying for a top post at a leading retailer.
There has been further speculation that Barneys might be looking for another top executive, possibly to assist with operations and report to Allen Questrom, chairman and ceo. Questrom, who could not be reached for comment, has repeatedly stated his confidence in the existing team of merchants.