Saks Fifth Avenue Merchandising Essay Example for Free

Saks 5th Avenue Merchandising EssayMerchandising Saks ordinal Avenue is a lead retail governing offering a wide assortment of luxury fashion app bel, accessories, shoes, jewelry, and cosmetics. Their main target market is the upscale customer that is willing to pay for main designer brands and products such as Louis Vuitton, Ralph Lauren, and many others. Currently, Saks has 46 stores by means of 22 states that are usually free standing in distinct shopping destinations or anchors in expensive regional malls as quoted from their annual report.Saks primarily focuses on providing luxury brands and unique merchandise to their summation customers. Because of the corner, Saks Fifth Avenue changed their methods of merchandising to become more goodable as well as disregard more to their customers but still kept their main focus on luxury and unique brands. In 2009, their last(a) profit margin was a shun 9. 7% with their net profit being negative $54,512,000 and starting off n et gross sales as $564,519,000. The CEO of Saks Fifth Avenue, Stephen Sadove, decided that the come with needful to pursue an offensive strategy rather than a defensive one.In found to maintain this strategy, Saks apply a 9-box grid strategy to chart their merchandise for each store. The 9-box grid strategy helped Saks categorize the outgo mix of clothe and accessories for the main customers at each of their store locations. There are three harm tiers to follow along the grid such as good, better, and best. Each item falls into one of these set tiers as well as three general lifestyle categories such as classic, uptown, and contemporary.These specific categories brook Saks with a better understanding of how their products are viewed by their customers as well as how much they are willing to spend on different items. Sakss Senior Vice President of Marketing and Advertising, Kimberly Grabel, say that they wanted to implement a strategy that had a good coverage for everyone to produce a actually blended customer base. From their findings along the 9-box grid, Saks tailors each of its stores to fit that customer base in that area. Fashion apparel located in their New York location will be different from the products presented in their Indianapolis store.As mentioned earlier, they specifically choose their store locations in their respective markets to target their core customers that value their merchandise. The most serious products to evaluate within this grid are Sakss private labels and exclusive products. These products build a patriotic customer base because shoppers cannot find them at any other retail store and improve company profit margins. One of Sakss private labels is called Saks Fifth Avenue Private Collections where they offer more undated clothing rather than trendy.Within this collection, they have three distinct lines such as signature, classic, and sports with prices ranging from $98 to $1,000 as stated in the New York Times artic le. Saks Fifth Avenues exclusive products are where they discover themselves in the luxury market and remain unique. In their annual report, the company states that they have key relationships with designers same Giorgio Armani, Chanel, Gucci, Prada, and Burberry, among many others. Just recently, they expanded one of their exclusive offerings in the mens collection with Valentino.At the moment, Saks Fifth Avenues presence of private labels and exclusive products in their stores are in the impose teens, but their goal is to reach 20%. Since exclusive products and private labels are so important to Saks merchandising, they labor these brands by in-store displays and catalogue layouts. Within their stores, each mannequin is dressed with only one specific designer. This gives an good to the exclusive designer of the featured clothing because a customer might see the entire sidetrack and want the complete package besides just a blouse.An article within The Wall passageway Journal states that within Sakss holiday catalogue, four out of six items shown are exclusive, so their customers be where to get that exact product. Because of these unique products as well as their 9-box grid strategy, Saks Fifth Avenue has returned from the recession on an ok note, and they continue to improve. In 2010, they began with net sales of $593,145,000 which was a 5% increase since August1, 2009. Their net profit was still in the negative at $32,234,000, but they had an increase of 4. % in their net profit margin.Within 2011, their margins increased even more with a 13% increase in net sales to $670,180,000, and a 4. 2% increase in net profit margin resulting in only having a negative net profit of $8,369,000 as stated in their SEC filings in the 10Q reports. In order to remain successful, Saks Fifth Avenue focuses on offering luxury brands and unique merchandise. With their distinct store locations end-to-end the country, Saks is able to reach their intended upscale customer and satisfy their needs and wants. By creating value with their products, Saks Fifth Avenue continues to be a lead retail organization.