Good Business Still There For Saks: Singer

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00:00There's a good business there. I mean, there's a loyal customer base. There are probably,

00:04I would imagine, I don't know, 500,000 to a million high net worth individuals in their

00:10customer databases. So there's one incredible asset. If you look at just the New York City

00:16stores, of which there are three, two Bergdorf, one SACs, obviously, those two stores combined

00:22probably do one to $1.5 billion. Their e-commerce business as a whole is probably around 25%

00:29of the entire $7.5 billion. So just those three stores and an e-commerce business, obviously,

00:37which would be smaller because it wouldn't get the power, that e-commerce business of the fleet

00:42of stores were they to be closed. I think there is a kernel of truth within that business. And

00:49that business can flourish and be hugely profitable, but probably not at the scale that it is today.

00:55And I think that, am I saying that they should reduce to three stores? No. But I think they'll

01:01have to take a hard look at, you know, what's the way to start? What would you do if you had a blank

01:06sheet of paper, which they, in essence, now do, and then build from there as opposed to doing the

01:12reverse, which is to say, OK, we'll trim 25% of stores. I think there's going to be a look at

01:18the entirety from, you know, first principles and maybe learn a few things about the concession

01:24model in Europe and see whether that's applicable here. And by the way, and this is the last point,

01:30using those incredible brands as luxury service platforms to sell other goods and services,

01:37not just obviously fashion and accessories, such as, you know, hospitality, travel, art advisory.

01:45I mean, you know, the spend of the luxury consumer today is incredibly heavy and that consumer is

01:53flourishing. Sure. But ultimately, you know, these stores are only selling them a certain piece of

01:59their share of wallet. Oh, does SAC still have a decent relationship with its vendors? Eliza was

02:05telling us earlier about how, you know, they were not paying their vendors on time at the end of last

02:10year. And that must have damaged some of those relationships, that trust. Well, I don't,

02:15I don't know the specifics, but what I can say is that from, I think, well before the merger,

02:23there was this, let's call it slow pay happening within the industry from SACs. I think that

02:29obviously was exacerbated going into 2025 when things didn't go maybe as planned synergies and also the

02:36direction of revenues. And so I do think there are, there are some issues and there are many big brands

02:44and not, not so big brands owed a lot of money. And I think that is going to be a somewhat contentious

02:51affair, I'd imagine. But nonetheless, both sides probably need each other to some extent.