Hudson’s Bay Co. is retrenching, offloading some investments in Europe, trimming superfluous ecommerce operations and selling the Fifth Avenue flagship and some branch locations of its Lord & Taylor department store chain.
“Further streamlining our retail portfolio enables even greater focus on our businesses with the strongest growth opportunities,” says HBC CEO Helena Foulkes. “The divestiture of Gilt, rightsizing of Lord & Taylor (and) the recent merger of our European retail operations in Germany … exemplify the bold strategic actions we are taking to set HBC up for long-term success.”
The foundation on which plans are being built is Saks Fifth Avenue, HBC’s star performer, putting together a string of quarterly same-store sales gains. “Saks has been good at identifying both top stores and top customers to invest in, and I see that as a real opportunity at Hudson’s Bay,” Foulkes says. Saks locations outside New York City have performed well, picking up some of the slack while the flagship Manhattan store is in the final stages of a makeover the company refers to as the Grand Renovation.
The aim of the renovation is no less than a reinvention of the department store experience, according to Marc Metrick, president of Saks Fifth Avenue.
“We are calling it the new luxury. As it relates to the customer, it’s everything about how they experience our store, how they experience our website, how we communicated with them,” Metrick says. “I think the New York flagship serves two purposes. It’s a beacon for everything we do at Saks brand and our position in the world. It also acts as the first stop along the way for rolling out concepts for the other stores.”
One of the renovated sections that opened earlier this year is the 53,000-square-foot handbag and accessory department on the ground floor. Three times larger than the old department, the new space is home to more than 50 brands, including 14 available at Saks for the first time, as well as more than 100 items exclusive to Saks.