The economy and the job market may be rocky, but Neiman Marcus enjoyed a strong April quarter, with earnings up 35 percent and comparable store sales – sales at stores open at least a year – up 6.7 percent.
The first quarter was a good one for retailers. Data from Retail Metrics show earnings were up the most in two years, and that the number of retailers who beat earnings estimates was up 5 percent from last year. The 12 year average gain is 3.2 percent.
Neiman, though, far outperformed that average and the industry, although store executives have been quoted as saying that the quarter had a strong start and a not-so-strong finish. It is among the world”™s most productive retailers in terms of the amount of sales generated per square foot.
“What Neiman has done so well is that they have been able to leverage their in-circle rewards program,” said Britt Beemer, founder of America”™s Research Group, a consumer behavior research and strategic consulting firm. “That”™s where you get so many points based on dollars. They”™re good at leveraging those points, with merchandise, incredible trips. They match what the customer would like to do with what they”™re offering.”
Beemer also pointed to some tried-and-true formulas for retailing success. “People say they have the best and latest styles, and there”™s always available help, who are knowledgeable.”
He also said customers say what they find there is not available anywhere else. “Good merchandising to the client is one thing, but that goes along with unique merchandise and excellent merchandising to the needs of the upscale customer.” Beemer added that unlike other stores which have laid off staff, Neiman has maintained its workforce.
“Nordstrom gets a lot of cross traffic from Neiman, that”™s because those customers share high expectations of customer service,” he said. As for the store”™s sales productivity per square foot, Beemer said, “The merchandise is expensive, don”™t forget, but it sells.” He said the store”™s intimate, cozy atmosphere is appealing as well.
There is talk that Neiman may go public. Beemer said he hopes that doesn”™t happen. “When you”™re publicly owned all efforts shift from long-term planning to quarterly reports. It”™s a death knell for companies that are long term thinkers,” he said. “The shareholder wants results now.”
