Saks Off 5th, the discount arm of luxury department store Saks Fifth Avenue, is closing its entire online operation and has launched a massive clearance sale with discounts of up to 90 percent. The move follows the Chapter 11 bankruptcy filing of its parent company, Saks Global, on January 14.
The online-only business of Saks Off 5th was separated from its physical stores in 2021. As part of the bankruptcy process, a court has approved the shutdown and sale of this e-commerce division. Once all stock is sold, the website will close permanently.
Physical Saks Off 5th stores are part of the wider bankruptcy but are not included in this specific liquidation. Saks Fifth Avenue stores and its main website are also unaffected at this stage. However, Saks announced in November that it would shut nine of its roughly 100 Off Fifth stores in January, and industry experts expect around half of all Off Fifth locations to close.
Saks Global, which also owns Neiman Marcus and Bergdorf Goodman, filed for bankruptcy just over a year after acquiring Neiman Marcus in a debt-fueled deal. The company secured $1.75 billion in financing and named a new CEO, stating that stores would remain open for now.
Retail analyst Neil Saunders of GlobalData commented: 'The debt-fueled acquisition of Neiman Marcus always made bankruptcy a likely destination for Saks Global. The only real surprise has been the speed of the collapse.' He added that the company faces a 'tall order' to reduce debt and rebuild supplier relations.
