[3/4/17] The luxury department store has become the first high-profile retailer to publicly enlist the help of advisers to restructure its mounting debt, but its problems are similar to those weighing heavily on the industry. Just this week, BCBG Max Azaria and Vanity filed for Chapter 11 bankruptcy protection while reports revealed that HHGregg is preparing an imminent filing. Analysts speculate that it’s only a matter of time before once dominant Sears files as well.
The struggling department store space is beset by challenges such as falling foot traffic, growing consumer demand for faster fashion and mounting debt issues. Neiman Marcus recently reported that its Q1 revenues fell 7.4% over last year as a result of dwindling traffic, and its net losses widened to $23.5 million, compared to Q1 2016 net losses of $10.5 million. The department store operates 42 Neiman Marcus Stores and 27 Last Call clearance centers.
In such dire times, Scott Emmons, head of the Neiman Marcus innovation lab, recently told Retail Dive in an exclusive interview that innovation isn’t just a good idea for retailers — it’s critical to survival. Changing shopping habits and emerging technologies bring new challenges to retailers like Neiman Marcus — and while they are no silver bullet, Emmons believes innovation labs can help solve the mounting problems facing retailers. “If you are encountering headwinds, one of the ways to counteract that is to look for a new or better way to deliver value to your customers,” he said.