Does Saks Have Its Priorities in the Right Place?
Completing a $2.7 billion dollar merger to then turnaround to your suppliers - many of whom have diminishing options - and then say, we won't pay you on schedule. Eh?
That means to me they plan to make money on "acquisition synergies" between Neiman's and Saks. Which, maybe. Acquisition synergies usually don't pan out.
This is of course the same CEO who had McKinsey advise him on splitting off the eCommerce business from the retailer. Who needs Unified Commerce anyway? It just gets in the way of a good financial engineering project and handsome consulting payoff.
Normally, with such behavior, I would see a hostile bidder or an aggressive private equity bid in Saks future. But perhaps the vultures have already nested and are having their run of the place.
The partnership announced last year with Authentic Brands Group to form Authentic Luxury Group and get into lifestyle and hotel categories tells the story - the company is expanding globally and will be licensing its name out to new ventures.
All the while, giving the middle finger to its suppliers. Are suppliers getting some of the Authentic Luxury Group royalties? No.
Does Saks really not have the funds to pay its suppliers on time after it invested billions in Neiman Marcus Group? This management team is suspect, and to me suppliers have been put on notice. While there are not many alternatives the size of Saks, voting with your feet would at least allow you to negotiate those terms. Otherwise …You are laying down with a dog.
Don't be surprised if you get fleas.
