Ladies who lunch love to shop at Bergdorf Goodman, a Fifth Avenue emporium of luxury goods. Bergdorf sells high-end women's apparel, handbags, precious and designer jewelry, makeup, perfume, shoes, and tableware, as well as men's accessories, by designer labels such as Chloe, Giorgio Armani, and Marc Jacobs. Owned by upscale department store operator Neiman Marcus, Bergdorf Goodman operates two opulent stores across from each other on 58th Street in Manhattan, that ring up about 14% of Neiman's total revenue. The smaller store, which opened in 1991, is devoted exclusively to men. The elite retailer also sells via a catalog and a website. Bergdorf Goodman has been doing business at its prime location since 1901.
The deep recession in the US and consequent downturn in demand for luxury goods hurt sales at both Bergdorf Goodman and its parent Neiman Marcus. After a lean couple of years, fiscal 2011 (ends July) brought a welcome increase in sales as demand for luxury goods rebounded strongly. The recovery began in fiscal 2010. Indeed, in the fourth quarter of fiscal 2010 Bergdorf Goodman's sales jumped more than 15% vs. about 3% for its larger sister chain. In October 2010 Bergdorf Goodman's president and CEO James Gold added the newly-created title of president and CEO of Neiman Marcus's Specialty Retail Stores segment, which consists primarily of Neiman Marcus and Bergdorf Goodman stores. The Specialty Retail Stores segment segment accounts for about 81% of Neiman's fiscal 2011 sales.
Gold's expanded role demonstrates the closer cooperation between the New York business and Dallas-based Neiman Marcus. For years, Neiman took a laissez-faire approach to dealing with its Fifth Avenue counterpart. However, in mid-2009 it combined Bergdorf's fashion office with its own in in a bid to cut costs as sales plunged. Hard feelings over consolidation (and increased responsibilities for some Bergdorf managers) led to the departure of Bergdorf's men's fashion director and turmoil in the ranks.
Neiman Marcus was acquired in 2005 by Texas Pacific Group (now TPG Capital) and Warburg Pincus, which together offered about $5.1 billion for the company. In July of that year, Bergdorf Goodman's private label credit card business was sold, along with that of its parent company, to HSBC-North America's Retail Services business. – less