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The Saks Fifth Avenue brand is headed to Costco, according to market sources.
The Saks Fifth Avenue brand name has been licensed to Centric Brands for men’s apparel and is headed to Costco over the coming months, sources said.
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A spokeswoman for Saks said she had “no comment,” and a Centric Brands spokeswoman declined comment. Costco, the membership-based warehouse club, didn’t return a phone call seeking comment.
Saks Fifth Avenue women’s merchandise is expected to eventually come to Costco as well, but a recent deal didn’t come to fruition.
Centric Brands‘ portfolio includes Joe’s Jeans, Buffalo, Hervé Léger and Izod in the men’s and women’s categories. The company has expertise in product design, development and sourcing, retail and digital commerce, marketing and brand building.
Costco over the years has carried such brands as Tommy Hilfiger, Wrangler, Eddie Bauer, Nick Graham, Adidas, Nike and Columbia, in addition to its own Kirkland brand.
Last October, Saks Global and Authentic Brands Group formed a joint venture to grow luxury brands. The new venture, called Authentic Luxury Group, was initially expected to focus on Authentic Brands-owned luxury and accessible luxury names including Barneys New York, Judith Leiber Couture, Hervé Léger and Vince.
It is believed the Saks-Costco deal emanates from this new joint venture. Authentic could be collaborating with its longtime partner Centric on the Saks arrangement with Costco. On Tuesday, Authentic tapped Centric Brands as Dockers’ operating partner across key lifestyle and performance categories in the U.S. and Canada, as reported.
Last fall, the principals of the Authentic Luxury Group outlined several ambitious plans and aspirations, such as rolling out Barneys retail locations or in-store shops, adding categories to existing fashion brands in the Authentic portfolio and widening their distribution in the U.S. and abroad, and purchasing brands. Essentially, the new luxury group is intended to serve as an incubator for brand growth through strategic licensing agreements and distribution channels across fashion, retail, digital, hospitality, real estate, art and travel, according to the joint venture.
In December, Saks purchased competitor Neiman Marcus for $2.7 billion — with help from Amazon, Authentic, Salesforce and G-III Apparel Group, and an eye toward forging a luxury powerhouse both online and off. The business is currently being reset and looking to reverse sales declines. Revenues at Saks fell 20 percent last year due to “disrupted inventory flow.” Saks Global said May 14 it will slash 500 to 600 brands that don’t work within the portfolio.