By Suzanne Kapner 

Neiman Marcus Group Ltd. said it will close more than half of its Last Call discount locations to focus on its luxury department stores, retreating from an area that has been one of the few bright spots in retailing.

Other retailers including Saks Fifth Avenue and Nordstrom Inc. have been ramping up their off-price stores that sell name-brand goods at steep discounts as a way to appeal to younger and more price-conscious shoppers. Both chains now operate more off-price stores than full-price stores. Market leader T.J. Maxx opened 21 stores last year, bringing its total to 1,273. Neiman Marcus currently has 22 Last Call stores.

"We are different from our competitors," said Neiman Marcus Chief Executive Geoffroy van Raemdonck. "Our strategy is to focus on the luxury customer and full-priced selling." He added that one-fifth of Neiman Marcus's customers spend an average of $50,000 a year with the retailer.

To better serve those wealthy shoppers, Neiman Marcus is combining its in-store and online teams. It will be training sales associates to interact with shoppers before and after purchases to help them with services such as alterations, beauty treatments and dining. It operates about 45 department stores, including Bergdorf Goodman in Manhattan.

As a result, about 250 nonselling associates will be let go. But because the company plans to hire new employees, the net reduction will be less than half that amount.

Neiman Marcus started paring back Last Call in 2017, when it announced the closure of about one-quarter of the fleet. It plans to close more than half of its remaining locations over the next eight months. About 500 jobs will be eliminated.

The company is also selling two distribution centers in Texas.

"This is not a pullback," Mr. van Raemdonck said. "This is a move forward. We've got a strategy that is working. We want to put our effort behind the full-priced, luxury customer. This is what will differentiate us from the competition."

 

(END) Dow Jones Newswires

March 11, 2020 12:31 ET (16:31 GMT)

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