A response to the WWD article today-Richard Baker Confirms Saks Global to Cut Up to 600 Vendors

And here we are 3 months later, (almost to the date), and my prediction has come true.

On February 23^rd, I posted my first piece on the Fashion Op-Ed which was in response to Marc Metrick’s Valentine’s Day salvo about how Saks is in great financial shape and how they were all for the vendor, and how everyone was going to get paid, as, long as you start shipping again.

If you read that piece, then you know what I predicted has come to fruition.

I say this, as a veteran of business management in this industry for almost 40 years. To be successful in this business, I have had to keep my eyes and ears open and understand that someone is always gaming for the big win. You cannot be jaded. You must read and consider all sides of a situation. Not the one you want to believe.

Having just read this article in WWD, it better be clear to everyone that this is going to be a real estate first venture for Richard Baker. He speaks only of real estate, hotels, TV shows, Amazon and his partners. That is, it. You, as a vendor as we used to know it, are extinct in this new business model.

To quote from my first post regarding Marc Metrick’s salvo on 2/14/25,

You say, “our expectation is that over the next year or so, we’ll be doing business with 25% fewer brands than we are doing business with today”. You go on to say, “we can’t have that many brands and be a great partner for each and vice versa”. TRANSLATION – if you don’t play our game we won’t buy from you. Please do not try and say that you are going to “choose” which 25% goes away. You are either going to put them out of business with this ridiculous “payment plan”, (if you haven’t already), or the vendors with financial stability will be smart, do a mini-P&L on their business with you and see it isn’t worth it and they will choose to stop doing business with you. Lets’ face it, no one needs Saks for marketing…. Saks hasn’t been a valid place to shop for newness, creativity, or excitement in years. I can only assume, you are counting on your new “partner’s” brands to fill the 25% gap.

My second quote from the post on 2/23/25:

“Yes, the model is broken, wholesale hasn’t been a partnership with brands in over 25 years. But if you continue to be a “partner” like this, you better start building your own private label brands because no one with half a brain in business would agree to work with you. The only “partners” in this agreement who will benefit are Saks, G-III, ABG, Amazon and Salesforce... and of course, the people leading those businesses.”

And finally, Richard Baker’s quote from today’s article:

To quote Richard Baker’s comment in the sub title of today’s article, “At the World Retail Congress, Baker said the group will move toward “controlled brands” with larger margins. He eventually wants 20 percent of sales to come from those products.”

So now here we are, literally 3 months later, and it is in play. They have, rightfully, cut back on vendors, but the biggest alarm that should be sounding, had you read this current Richard Baker article, is:

“As part of our transaction, we have over $600 million a year in synergy. We all know how hard we have to work to make an additional $600 million a year, and that’s what we’re first and most important was getting that figured out at Saks Global,” said Baker.

“If I can bring our mix to 20 percent controlled brands with a larger margin and an ownership position with Salter, that’s a tremendous win for us, and a much more conservative and appropriate cash flow,” he continued.

Salter added, “You take 20 percent of $9 billion, that’s $1.8 billion. He’s gonna make 25 percent more on that product. That’s almost a $400 million change. That’s why this relationship is so critical.”

Saks Global has been hammering out many deals, both commercial and financial, of late.

And there you have it. It all comes down to their margin, and when I say their, I mean Richard Baker, Jamie Salter, the family of G-III, and Amazon.

Please go back and read my piece titled, “To Major or not to Major, that is the question” posted on March 23^rd. There is so much real information on what to consider before working with any Major, (I guess Nordstrom or Bloomingdales, maybe Net?), and so much real information on the pros of building relationships with independent stores.

I am writing this Substack to share the knowledge I have gained throughout my career. The real life, on the job experience you cannot and sadly still do not, get in any fashion school classroom.

My only goal here is to continue my original path of mentoring and consulting with brands by sharing this knowledge; straight forward, not sugar coated, and honest.

If you want to survive in this business, and have a brand, you have to know how to run your business. You have to be aware of everything major political, financial, climate issue, that goes on in the world, how it will affect every aspect of your business, and how to pivot when things get tough.

Well things are tough, and it is time to pivot.

As always, I am here to help…. You know where to find me.