Neiman Marcus Latest To Cut Staff As U.S. Retailers Shed Workforce

When Neiman Marcus Group announced plans to lay off about 5% of its 10,000-strong workforce, or around 500 employees, the company joined a growing list of U.S. retailers shedding staff.

The luxury department store chain is looking to cut costs amid a tough economy and it is far from alone, with both The RealReal and Tuesday Morning entering Chapter 11 over the past few days and Bed, Bath & Beyond instigating a last-ditch bail out.

In truth, empathy for Neiman Marcus may wear pretty thin with shoppers on Main Street, after the company dropped aspirational shoppers for the ultra-wealthy like a hardly-worn party dress.

Customers at the high-end department store spending $27,000 annually are those the brand is focused on now, according to an interview Geoffroy van Raemdonck, CEO of the store’s parent company, gave to Fortune.

“We’ve decided that we are no longer about market share, and we are no longer about selling everywhere on the price spectrum, from clearance to high-end jewelry,” van Raemdonck said. “The business value of this approach is we get to know our customers better. The economic value is I avoid churn, and the price is no longer the main consideration.”

All Change At Neiman Marcus

Announcing the layoffs, the company also said its Chief Product & Technology Officer, Bob Kupbens will leave, while Neiman Marcus President, Ryan Ross will lead customer insights for the group. Darcy Penick, president of luxury department store Bergdorf Goodman, will assume group-level leadership of NMG Product & Technology.

Neiman Marcus and its sister company, Bergdorf Goodman, already attract the well-heeled and the top 2% of the group’s customers represent a chunky 40% of its total sales, and 80% of those customers are worth at least $1 million.

The company filed for Chapter 11 early in the pandemic, from which it emerged in fall 2020 with an outline strategy to focus on wealthier shoppers.

But the new round of layoffs means it has joined a growing roster of retailers that have confirmed they will reduce their workforce, who include:

AmazonAMZN

The big one. After years of expansion, Amazon conceded that even it had out-stretched itself and shed about 18,000 employees in January, many of them focused on the e-commerce giant’s brick-and-mortar business, which continues to struggle.

The RealReal

The RealReal said it will cut operating expenses through lay offs and store closures. The apparel resale company will let go about 230 employees, or 7% of its workforce, according to a SEC filing. Two flagship stores in San Francisco and Chicago, two neighborhood stores in Atlanta and Austin, plus two offices in Miami and Washington D.C., will shutter.

Tuesday Morning

In Chapter 11 again, Tuesday Morning said it “has too many stores and stores in unprofitable locations,” while railing at its lenders. It wants to close 264 of the 464 stores it operates in 39 states, to operate from about 200 stores and with inevitable job losses.

Beyond Meat
BYND
Inc.

The vegan meat manufacturer said that it plans to cut about 200 jobs this year in a bid to save about $39 million as it finds its plant-based feet.

WayfairW

The online home goods retail giant cut 1,750 jobs, around 10% of its workforce, in January. The majority of the layoffs, about 1,200 positions, were corporate.

Stitch Fix

About a fifth of the company’s workforce of 1,700 employees were cut in January. In 2022 it shut its Mohnton Mills, Penn. plant.

DoorDash
DASH
Inc.

The super-fast food delivery firm said it is to reduce its corporate headcount by about 1,250 employees as the sector experiences a post-pandemic drop off.

Bed Bath & BeyondBBBY

The retailer will lay off employees this year in an attempt to reduce costs after a last-ditch funds raising round staved off Chapter 11 bankruptcy. New finance may provide a platform for growth or put off the inevitable.

REI

In all, 167 corporate employees were laid off from the outdoor pursuit retailer in February, about 8% of the company’s HQ staff and 1% of its total workforce.

Everlane

The D2C apparel brand laid off 17% of corporate staff and nearly 3% of its retail workforce were cut.

Saks.com

At least 100 positions were taken out of the e-commerce branch of Saks Fifth Avenue, or about 3.5% of its staff, and it made an undisclosed number of layoffs.

Zappos

More than 300 workers, representing around 20% of the workforce, were cut from the Amazon-owned online footwear brand as part of the wider January layoffs.