NEW YORK — Bergdorf Goodman is on the hunt for a new chief executive officer, according to sources.
This story first appeared in the January 28, 2004 issue of WWD. Subscribe Today.
Principals were curiously mum Tuesday after a report that current ceo Ron Frasch would be joining Saks Fifth Avenue as chief merchant. Rumors heated up throughout the day and while there was no confirmation at press time of such a move, sources indicated that Frasch has not been in his office at Bergdorf for at least a week and did not attend the recent men’s wear shows in Milan and Paris.
It’s highly unlikely he’ll return to his position at Bergdorf.
When asked whether Frasch would be joining Saks, Stephen Sadove, vice chairman of Saks Inc., said: “We have no comment.”
Sources, however, indicated that a move to Saks is a distinct possibility for Frasch, although not a sure bet. While discussions, it appears, are well under way, the role might be different from that of chief merchant. The report connecting Frasch and Saks appeared in Tuesday’s New York Post.
Reached late Tuesday in Dallas, Karen Katz, ceo of Neiman Marcus Stores, said of the rumor surrounding Frasch: “I don’t know anything about that.” Neiman Marcus Group is the parent of Bergdorf Goodman.
A veteran of both Saks and Neiman Marcus, Frasch, 55, is a longtime friend of Fred Wilson, the new ceo of Saks Fifth Avenue, and observers speculated that the two would make a formidable executive team.
“Fred is strategic and the market enjoys Ron a lot,” said one industry source who knows both men. “His visibility would bring Saks to a new level. It’s a very powerful team.”
At Neiman Marcus, Frasch is not viewed as the heir apparent to Burton Tansky, the 65-year-old chairman and ceo of the group. One reason cited by sources in the past has been Frasch’s reluctance to move to Dallas, where Neiman’s is headquartered. Also cited are his love of the merchandising side of the business and disdain for the heavy bureaucratic responsibilities typical of a retail ceo’s responsibilities.
Last year, Saks retained Russell Reynolds Associates to find a chief merchant for the chain, but the search was put on hiatus after former ceo Christina Johnson’s forced departure in October. Wilson officially took over as ceo Jan. 1.
Bobbie Lenga, partner and managing director of the retail practice at Russell Reynolds Associates in Chicago, said Frasch was definitely on the list of people to consider last year, but she hadn’t heard Tuesday whether he was offered the job.
“He has a relationship with Fred. This [Saks] is a bigger landscape and a bigger business. Bergdorf Goodman is a dream job, but I think if he chooses to do this, it will only make him even that much more of a general manager. And he’ll have more exposure to different geographies and different consumers. It could be a beneficial experience for him. He’s a great merchant and a good guy,” said Lenga.
“He’s a natural for it,” added Gilbert Harrison, chairman of Financo, the investment banking firm here.
Frasch could not be reached at press time. Tansky, who was in New York Tuesday, was unavailable.
Frasch was named chairman and ceo of Bergdorf’s in April 2000, succeeding Stephen Elkin, who left to become ceo of Fashion500.com.
Frasch has had a long career in women’s merchandising. Before joining Bergdorf’s, he was president of GFT USA from July 1996 until March 2000. Before that, he was president and ceo of Escada USA from February 1994 to June 1996. Prior to that, he was at Neiman Marcus 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. Earlier he was the dress divisional merchandise manager at Saks.
Saks Fifth Avenue has been in need of a top merchant following the departures of two key executives: Gail Pisano, executive vice president of merchandising for women’s designer and Gold Range merchandise, intimate apparel, jewelry and accessories, who left the company in July, and Wayne Meichner, Saks’ other executive vice president for merchandising, who handled men’s wear, cosmetics and ready-to-wear and who left the store in May 2002.
Frasch has overseen Bergdorf’s transition from a worn, stodgy retailer to its newest incarnation as a luxe, gleaming Fifth Avenue institution. Over the past three years, he has been at the helm of the store’s approximately $70 million renovation as well as its intensified marketing strategies. The retailer, with 193,000-square-feet of selling space, aimed to recast its image and reach out to a younger, hipper customer while maintaining its older clientele and classic sensibilities.