The Neiman Marcus Group, apparently transcending the volatile stock market and the nation’s sky-high inflation, is generating sales volumes and margin gains surpassing pre-COVID-19 levels. The company attributed the results largely to shoppers returning to stores, digital strength, robust full-price selling, adding luxury brands and exclusives to the offering, and a richer calendar of events. As a private company, NMG does not publicly report its financial performance. Almost half of the Neiman Marcus stores are experiencing all-time high sales volume. [Bergdorf Goodman is also seeing significant recovery in stores, beating 2019 numbers.
The luxury retailer is investing back in the business, including $300mn to renovate the Bal Harbour, Florida; Atlanta; White Plains, New York; St. Louis; Oak Brook, Illinois; Houston; Paramus, New Jersey; San Diego, and Tysons Galleria, Va. stores. The first remodel, at the Atlanta store, will be completed this year. Six store remodels are slated for next year, and two stores the year after. In several cases, men’s, shoe and handbag areas will be expanded, and several incoming brands require building dedicated shops. In some locations, bars and cafes will be added, and new restaurants in select stores are being considered.
Last year the company invested more than $200 million in technology initiatives such as Connect, a tool for associates to communicate with customers; the acquisition of Stylyze; the Neiman Marcus Stanley app, and Digital Labs. In addition, Neiman’s said it’s committed to spending more than $90mn to enhance its supply chain, including systems and fulfillment centers. Neiman Marcus said that EBITDA margin rate is in the mid-teens which is really strong, mentioning also that the company is net profitable.
Gen Z, Millennials and Gen X represent 60% of the customer base and Neiman’s shoppers, on average, are in their mid-30s; before the health crisis, customers on average were in their mid-40s. Neiman Marcus added over 600 new points of distribution with designers and brands in fiscal 2022, including over 200 brands for spring 2022, many of which were exclusive and had an ESG tie. At the Neiman’s division, last quarter, men’s growth exceeded 60%, driven by rtw and shoes, which both doubled in volume; women’s shoes grew by over 50%, and handbags rose over 70%. Women’s rtw also saw double-digit growth but not as much as the other areas. At Bergdorf Goodman, handbag sales were up almost 80%; shoes rose over 60%; fine apparel rose over 30%. BG online saw “triple-digit growth in full-price and strong double-digit growth across every customer segment…New online customers were up double digits compared to FY19