Saks Isn’t Failing—Luxury Is

We’ve already lost Bendel’s. We’ve already lost Barneys. Keep blaming the retailers, and watch as the entire industry collapses under its own arrogance.

“Sales at Saks Fifth Avenue, Neiman Marcus plunge after merger,” one headline reads. Another credits Bloomingdale’s and Nordstrom with picking up the slack. Social media is full of talking heads eager to pin Saks’ problems on bad timing or overleveraging. But most miss the bigger picture. The issues rattling Saks—and the mounting financial pressure behind them—go beyond the balance sheet. This isn’t just a department store problem. It’s an industry problem.

But I’d argue it’s not that simple. The Saks and Neiman Marcus merger came on the heels of a luxury boom. Prices were rising, demand was strong, and it seemed like high-end retail could do no wrong. Now, with a softening market and bond debt hanging over them, Saks is in a tight spot. And there’s really only one lever left to pull: sales.

What no one wants to say out loud is that this isn’t a department store problem—it’s a brand pricing problem. Luxury houses have spent the last few years dramatically increasing prices, often with no real change in product or experience. A classic Chanel bag that cost $5,800 in 2019 is now close to $12,000. Ready-to-wear from brands like Celine, Dior, and Valentino often pushes past $4,000 for a jacket or coat, pricing out even the aspirational customer who once saved for that one special piece.

Bloomingdale’s and Nordstrom aren’t just outperforming Saks because of strategy—they’re offering customers more flexibility. Their assortments include brands at different price tiers, from contemporary to designer, and they’ve built in room for the customer who isn’t looking to spend $3,500 on a handbag. Saks, by contrast, has become increasingly reliant on ultra-luxury—brands with strict pricing policies and limited distribution that don’t leave room for the customer who used to shop aspirationally.

But that flexibility comes with trade-offs. You can’t be Bergdorf Goodman or Saks Fifth Avenue with racks of Nike sneakers and Adidas socks. Prestige doesn’t scale down easily—and the moment a store chases volume over curation, it risks losing the very identity that made it aspirational in the first place.

Even worse, when a product actually does take off, retailers are often cut out. Think of The Row’s Margaux bag—quiet luxury at its peak, and nearly impossible to find at a department store once demand surged. Or Loro Piana’s Summer Walk shoes: once everywhere on the sales floor, now increasingly siloed within the brand’s own stores and e-comm. Retailers take on the risk, help build the buzz, and just as momentum peaks, the brand pulls back to sell direct.

This is the pattern. Department stores carry the staffing costs, the floor space, the markdown risk—while brands preserve full-price margins and cherry-pick where and how they show up. It’s not a real partnership. It’s leverage.

If luxury brands want their retail partners to survive—and they should, because few can thrive on DTC alone—they’re going to need to step up. That means loosening control, rethinking pricing, and remembering that when customers walk into Saks, they’re not just shopping the brand—they’re shopping the edit. If there’s nothing left for the retailer to edit, the whole model breaks.

We’ve seen this in other industries. When airlines, banks, or oil companies threaten to collapse, the market doesn’t sit back and assign blame—it moves to stabilize the system. “Too big to fail” becomes a call to act, not an invitation to gloat. Luxury retail is in a similar position now. But in fashion, no one wants to admit it.

Luxury brands don’t just need department stores. They depend on them. And if they’re not willing to support the infrastructure that built their empires, they might find out the hard way what happens when it disappears. Who remembers Henri Bendel’s and Barneys?