Saks Global partners with Authentic Brand Group on luxury venture

Saks Global and Authentic Brands Group are forming a joint venture aimed at growing luxury brands, WWD has learned.

The new business, called Authentic Luxury Group, will initially focus on Authentic Brands’ owned luxury and accessible luxury brands, including Barneys New York, Judith Leiber Couture, Hervé Leger and Vince.

Authentic Luxury Group leaders will continue to develop Barneys retail stores and in-store shops, add categories to existing fashion brands in the Authentic Brands portfolio, expand distribution in the U.S. and internationally, purchase and more. , advertised some ambitious plans and aspirations. brand. Essentially, the new luxury group will act as an incubator for brand growth through strategic licensing agreements and distribution channels across fashion, retail, digital, hospitality, real estate, art and travel, the joint venture said.

“We’re creating a premium version of Authentic Brands, which is half-owned by Saks Global and half-owned by Authentic Brands,” Richard Baker, executive chairman of Saks Global, told WWD. “This will be a new business for Saks Global.”

Saks Global includes Saks Fifth Avenue and Saks Off 5th stores and websites, as well as U.S. real estate holdings and investments. Authentic Brands’ portfolio includes Shaquille O’Neal, David Beckham, Sports Illustrated, Marilyn Monroe, Elvis Presley, Muhammad Ali, Reebok, Fly, Aeropostal, Forever 21, Nine West and Eddie Bauer. is a brand development, marketing and entertainment platform. Among other things.

“Jamie and I just returned from a nine-country tour where we traveled together and independently for over 24 days and met with top retailers, vendors, partners and distributors from around the world,” Baker said. spoke. Jamie Salter is the founder, chairman and CEO of Authentic Brands.

These meetings appear to have given the heads of Authentic Luxury Group some assurance that they can accomplish their mission. “We’ve been talking to a lot of partners around the world, and they’re all very, very supportive of this deal,” Salter said. “We didn’t just go out and say, ‘Let’s just do this,’ right? We’ve been talking about it for a year.” Many of these partners are distributors and retailers for brands owned by Authentic Brands. The company operates in Thailand, Korea, Japan, and other countries. Authentic Brands has 3,500 full-price stores, 1,500 outlets and 8,000 shop-in-shops worldwide. They all have licenses.

“If you look at our distribution, almost 50 percent is through these stores. The other 50 percent is on a wholesale basis at approximately 400,000 points of sale around the world,” Salter said. said.

“Working with Jamie will allow Saks Global to have Barneys and Saks stores all over the world, including the Middle East, China and South Korea, because he already has the network in place for us to start the conversation. ” Baker said.

Barneys’ former flagship store on Madison Avenue closed permanently in February 2020, and Authentic Luxury Group has no plans to reopen the flagship store. Barneys will remain owned by Authentic, but Barneys will be co-managed by ALG’s partners, principals said.

“With the various brands that Authentic Brands Group has acquired – Champion, Billabong, Reebok – the list goes on and on, we’ve served that middle class really well on a global scale,” Salter said. he said. “But luxury goods and affordable luxury are a more difficult space. We’ve dabbled in that business. We’ve worked with Ted Baker, Brooks Brothers, Judith Leiber, Vince, Hervé… We own Léger. So when you look at our portfolio, it’s always about distribution, distribution, distribution. We need good distribution to sell the brand…our international reach around the world. We believe we can build something very strong with our strong connections and obviously our relationship with Saks and the possibility of a future (Neiman Marcus Group) acquisition by Richard,” Salter said. . In addition to the joint venture, Authentic will take a minority stake in Saks Global after Saks closes its deal to acquire Neiman Marcus Group.

“We’re really going to expand the categories for these brands because there’s support from retailers to support these new categories. We didn’t have that kind of support in the past. Now, Richard is expanding the categories around the world. He has a huge interest in helping build Hervé Leger beyond just great dresses. ” Salter said, giving an example of what a joint venture could do.

The relationship between Saks and Authentic Brands continued as Authentic Brands entered into a $271 million deal to acquire Barneys from bankruptcy, eventually opening a Barneys store in the Saks Fifth Avenue flagship store in Manhattan. This goes back to November 2019. All Barneys stores in the United States have been liquidated, but Barneys currently survives with 10 licensed stores in Japan, a Barneys Men’s Store in Greenwich, Conn., a Barneys Beauty & Fragrance Store in South Korea, and a space inside Saks. . A Barneys pop-up opened on September 5th on Prince Street in Manhattan for five weeks. In addition to creating Barneys-branded products, including accessories, shoes and homewares, “a complete lifestyle brand proposition of Barneys products” developed through the Authentic Luxury Group, Baker will He talked about the possibility of opening Barneys stores in China and other countries. .

“When we went to Japan, it was very eye-opening for Richard because 30 percent of what’s in Barneys stores is Barneys products,” Salter said.

With the Barneys deal signed a few years ago, “we kind of tested each other from a relationship standpoint, and we obviously like each other,” Salter said. “Given what Richard is about to acquire, we thought it made a lot of sense to enter into a longer-term partnership with Saks Global. I don’t think he will stop. He will continue to expand his empire around the world,” Salter said. About three months ago, Barneys New York Residences opened in Tulum, Mexico for luxury vacation stays.

When asked how the Judith Leiber, Hervé Leger and Vince brands can grow, Baker said: It has the potential to be sold all over the world in the same way that luxury brands are sold. ” Lieber is known for its quirky, pop culture-inspired handbags, Hervé Leger is known for its iconic bandage dresses, and Vince focuses on his own relaxed sophistication inspired by California. Masu.

The timing of the new venture is interesting, given the slump in the luxury goods sector and Saks Global’s acquisition of Neiman Marcus. “This is something Jamie and I have been talking about for a long time and, as Jamie said, this is a great opportunity for us to launch a luxury brand, an aspirational luxury brand, around the world,” Baker said. said. “We have already started with Barneys, this is just a continuation and development of what we have been working on.

“The opportunity is huge for the luxury brands we work with[at Authentic Luxury Group],” Baker said. “Traveling with Jamie allowed me to see first-hand the opportunities in places like Korea, Thailand, Japan, and India, all of which are planning to open Barneys stores and launch products. And we intend to do big business in these markets with very strong local partners.

“As we acquire new brands and grow existing brands in our portfolio, we will be able to distribute our brands not just within our department stores and digital networks, but around the world,” Baker said.

“We are confident that we can build a multi-billion dollar platform over the next five years,” Salter asserted. “We’re taking Authentic’s strategy and applying it to aspirational luxury brands.”

Authentic Luxury Group intends to grow Barneys, Judith Leiber Couture, Hervé Leger and Vance, as well as Saks Off Fifth and Authentic Brands’ art business, Iconic Images. . “We own a ton of copyrights in the art world,” Salter said. Last month, Saks began selling art, announcing a fine art collection of more than 100 limited-edition contemporary prints.

Salter added, “Many partners around the world want Sachs Off 5th.” He mentioned Poland.

The joint venture could also open up some options for Neiman Marcus Group’s Bergdorf Goodman. Just hypothetically, Mr. Salter said, “Maybe we’ll see the Bergdorf condominium hotel.”