Saks Global CEO Says Top Brands Are Shipping Despite Bankruptcy

(Bloomberg) — Hundreds of brands, including Burberry and those owned by luxury powerhouses LVMH and Kering, have either restarted or continued shipping to the troubled retailer trying to emerge from bankruptcy, Saks Global Enterprises said.

The company, which includes Saks Fifth Avenue, Neiman Marcus and Bergdorf Goodman stores, plans to purchase about $1.2 billion worth of products in the next few months, Chief Executive Geoffroy van Raemdonck said in an interview with Bloomberg News.

These products come from more than 380 brands, some of which have resumed shipping after taking a break as the company drifted into bankruptcy. That’s three times the number of brands shipping in January, the CEO said.

This marks a significant step forward for the store operator’s turnaround; But that’s just one of many hurdles as Saks Global struggles to regain its value as a high-end shopping destination.

“Brands are starting to recover faster than I thought,” said van Raemdonck, who took over the company after filing for Chapter 11 last month. “The majority of brands ship.”

The $1.2 billion worth of product the labels have committed to ship in terms of retail value represents about three-quarters of what Saks Global estimates it will receive from February to April. That means it still expects to buy hundreds of millions of dollars of additional stock to meet its target in the first quarter of the fiscal year.

“We have resumed shipping to Saks Global,” Burberry CEO Joshua Schulman said in a statement. He added that the brand plans to connect with Saks Global’s dealer team, which placed orders for the fall and winter season, in the coming weeks.

Christian Louboutin, Brunello Cucinelli, Zankov, Brandon Maxwell, Lafayette 148 and the labels of LVMH and Kering companies are among the brands that have resumed or continued shipments.

To increase revenue, Van Raemdonck said his team focuses on ordering products from brands that sell quickly and need to be reordered, such as cosmetics and seasonal or on-trend fashion items.

As rumors of filing for bankruptcy increased in November, many brands slowed down or stopped their shipments altogether. But van Raemdonck said “some brands continued to ship throughout the entire process,” including Chanel.

The label operates through franchise; In other words, he runs his own store in large department stores. Brands using the concession model do not pause shipments, Van Raemdonck said.

A Chanel spokeswoman said in a statement that the company continues to ship products to Saks Global “uninterrupted” and “supports its successful restructuring efforts.”

The steadier flow of goods has been a positive development for bondholders and other investors who have provided billions of dollars in financing to help Saks Global emerge from bankruptcy. It’s also a welcome sign for shoppers who were disappointed last year when stores were poorly stocked.

But van Raemdonck and his team still have a lot to do. Saks Global needs to encourage companies that are still shipping to ship even more, and companies that are on the sidelines for fear of never getting a refund to get back on board.

“I don’t know if any of our top 100 brands have told us they won’t do business with us going forward,” said van Raemdonck, who was chairman of Neiman Marcus Group when it merged with Saks Fifth Avenue to form Saks Global in 2024.

Of course, he said, some brands that do not continue shipping ask questions to learn about the company’s financial health before shipping products.

When Saks Global filed for bankruptcy, court documents showed it owed tens of millions of dollars in repayments to some vendors. Van Raemdonck declined to comment on those negotiations or which brands have discontinued shipments.

It also needs to win back customers who have shifted their shopping to Bloomingdale’s and Nordstrom Inc., which are owned by Macy’s Inc.; In both, sales increased at Saks Global’s expense.

Saks gained access to $825 million of the $1.75 billion capital committed by investors during the bankruptcy process.

Van Raemdonck said the company “has sufficient liquidity to purchase inventory.” He said sales are down this year compared to last year because the company is still working to keep enough product in stores.

The value of Saks Global’s stock in February so far has fallen by a low-single-digit percentage compared to the same period last year, the CEO said.

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