Saks Global Takes Shape, Triggers Appointments, Consolidation and Layoffs
Key functions of the Saks.com, the Saks Fifth Avenue stores known as SFA, and Saks Off 5th companies are being merged under the Saks Global umbrella.
The strategy represents an effort to create efficiencies and will lead to what sources said were about 100 layoffs, or 1 percent of the staff, including the elimination of certain positions.
Legal, technology, operations, people, communications and finance teams from the three companies will be consolidated under the Saks Global corporate umbrella.
Earlier this month, Saks’ owner HBC reached a definitive $2.65 billion deal involving Amazon, Rhône Capital, Salesforce and other investors and lenders to combine Saks and Neiman Marcus Group under the same corporation called Saks Global, which is in the process of being formed.
The Saks-Neiman’s deal is pending government approval. The Federal Trade Commission has been requesting information from Saks, which already supplied some, and Saks will have to make a case for the combination, likely pressing how both retailers have a greater chance of surviving, and thriving, under one corporate entity rather than as separate companies. Saks will also stress how there’s still plenty of competition in the luxury sector from multibrand websites, and luxury brands operating their own stores and websites.
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As previously reported, Marc Metrick, who has been chief executive officer of Saks.com, will assume the role of CEO of Saks Global, overseeing Saks.com, the Saks Fifth Avenue and Saks Off 5th companies, in particular the merchandising and marketing functions. He reports to Richard Baker, executive chairman, Saks Global.
Metrick told WWD that Saks Global can be regarded as a “supporter-operating company,” with back-of-house functions such as legal and finance included. “Nothing is changing as far as how the customer-facing elements are being run at the channel level,” Metrick explained. “The Saks Fifth Avenue stores, Saks.com, Off 5th, they are all their own verticals. What is not changing is their marketing and the merchandising functions. Customers want the best online experience. Customers are also looking for a great store experience. But that doesn’t mean there are not more efficient ways to run functions that enable our customer-facing businesses to focus on the experience.”
In a memo distributed to employees on Tuesday, a copy of which was obtained by WWD, Saks indicated that certain roles were eliminated as a result of the changes occurring at Saks Global, essentially involving centralizing certain operations. “Decisions that impact team members are never easy, but they are necessary to strengthen our financial performance and support our future success,” the memo indicated.
With the consolidation of functions, several executives have been reassigned to Saks Global positions, and will be reporting to Metrick, including Mike Hite, who has been named chief technology officer. He joined Saks in April 2021 as chief information officer, and has been Saks’ CTO since January 2023.
In addition, Rob Brooks becomes chief operating officer, overseeing digital operations, supply chain and logistics, contact centers, sustainability, asset protection, procurement and India business operations. He was president and CEO of Saks Off 5th since March 2023.
Kim Miller succeeds Brooks as president of Saks Off 5th. She was CEO of Boutique Brands, which invests in online boutique retailers focused on women’s apparel. Prior to that, Miller was chief marketing officer for Rakuten. Earlier in her career, she worked at Charlotte Russe, Macy’s and HP.
Mara Sirhal, chief merchant for Saks Off 5th, has left the off-pricer. Now the Off 5th merchandising team will report to Miller, and will be led by two Off 5th senior vice presidents and general merchandise managers, Melissa Garrick for the center core and footwear areas, and Allison Ross, apparel.
And Sarah Garber has become chief people officer. She was chief people officer for Saks since March 2021.
Jeff Pedersen has been named chief financial officer, Saks Global, effective Aug. 12. He succeeds Vince Phelan, who served as CFO for Saks until leaving the company earlier this year. Pedersen currently serves as CFO for Andela, the world’s largest private marketplace of skilled digital talent, and earlier worked at IBM and Dell.
Also, communications for Saks Global will be led by Nicole Schoenberg, senior vice president, who will continue to report to Emily Essner, chief marketing officer at Saks.
“Today marks a major step forward in the creation of Saks Global, which will allow us to build on the success of our strategic move to separate the stores and e-commerce businesses,” Metrick said in the statement to employees. “Powered by technology and centered on the consumer, establishing Saks Global will accelerate our efforts to innovate the luxury shopping experience for our customers.”
Saks also indicated that Essner, as well as Stephanie Salierno, senior vice president of planning, and Tracy Margolies, chief merchandising officer, “will continue to be part of the Saks organization within Saks Global,” reporting to Metrick. “Emily, Stephanie and Tracy’s teams will also continue to partner with SFA as they have been.”
Saks Global, a combination of luxury-oriented retail and real estate assets, includes Saks Fifth Avenue, Saks Off 5th, and will include Neiman Marcus and Bergdorf Goodman if the merger deal is approved. The plan is for each unit to continue to operate under their respective brands, according to HBC. Saks Global will include HBC’s U.S. real estate assets and Neiman Marcus Group’s real estate assets, creating a $7 billion portfolio of retail real estate assets.
Also, HBC’s Canadian business, which includes TheBay.com, the Hudson’s Bay department stores, and $2 billion in real estate, will be recapitalized and stay separate from Saks Global, with “significantly reduced leverage and enhanced liquidity,” the company said.
