What happened to Saks?

Summary

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Marketplace Morning Report – "What happened to Saks?"

Date: January 15, 2026
Host: David Brancaccio
Featured Reporter: Kimberly Adams

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Episode Overview

This episode centers on the surprising bankruptcy filing of the parent company of several luxury department stores—Saks Fifth Avenue, Neiman Marcus, and Bergdorf Goodman. Despite affluent Americans having money to spend, these flagship luxury brands face deep financial trouble. The show explores key factors behind the bankruptcy, including changing consumer habits, shifting luxury brand strategies, and increased competition. The discussion also briefly touches on global markets and U.S. policy developments but focuses primarily on the retail segment’s evolving dynamics.

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Key Discussion Points & Insights

1. The Paradox: Why Are Luxury Stores Struggling?

• Host David Brancaccio sets the stage by questioning why luxury department store chains are faltering when higher-income consumers reportedly remain financially strong.

  • “Why are fancy store chains falling into bankruptcy when richer shoppers have money to spend?” (00:01)

• Bankruptcy Context:

  • Parent company of Saks, Neiman Marcus, and Bergdorf Goodman filed for Chapter 11 bankruptcy, aiming for reorganization rather than liquidation.
  • Higher-income consumer resilience is contrasted with the stores’ declining fortunes.

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2. The "Aspirational Shopper" Dilemma

• Kimberly Adams explains that luxury buyers fall into two groups:

  • The ultra-wealthy, unaffected by price.
  • "Aspirational shoppers"—those who strive to occasionally buy high-end goods.
    • Shika Jain (Lead Partner for North American Retail, Simon Kutcher) clarifies:
      • “When it comes to luxury, you know, Saks Fifth Avenue, Neiman Marcus, other players like that are more what I would call in the aspirational luxury.” (00:48)

• Vulnerability of Aspirational Shoppers:

  • These consumers are the most likely to cut back “in times of job insecurity and higher prices for everything from housing to health care, especially younger consumers,” says Lars Perner (USC's Marshall School of Business). (00:59)
  • Many middle incomes have suffered, putting luxury shopping out of reach.
    • “Many of the incomes have taken more of a hit, so they haven't had the same opportunities to get into luxury products that they would have had when times were better.” (01:19)

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3. Rising Competition from Luxury Brands’ Own Stores

• Marie Driscoll (Retail Expert, Driscoll Advisors) outlines a key shift:

  • Luxury brands like Dior, Chanel, and Louis Vuitton increasingly open their own boutiques, drawing customers away from department stores.
    • “What has happened in the last 20 years is many of the luxury brands have opened up their own stores like Dior, Chanel, Louis Vuitton.” (01:39)

• How Department Stores Can Compete:

  • Driscoll advises department stores to double down on creating luxury experiences, even for shoppers making smaller purchases.
    • “…department stores will have to lean into the idea of offering those aspirational shoppers a luxury experience, even if they’re in the store for a budget purchase.” (01:46)

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Notable Quotes & Memorable Moments

• Shika Jain on Saks as "aspirational luxury":
  • “When it comes to luxury, you know, Saks Fifth Avenue, Neiman Marcus, other players like that are more what I would call in the aspirational luxury.” (00:48)
• Lars Perner on middle income challenges:
  • “Many of the incomes have taken more of a hit, so they haven't had the same opportunities to get into luxury products that they would have had when times were better.” (01:19)
• Marie Driscoll on brands going direct:
  • “What has happened in the last 20 years is many of the luxury brands have opened up their own stores like Dior, Chanel, Louis Vuitton.” (01:39)
• Driscoll on staying relevant:
  • “…department stores will have to lean into the idea of offering those aspirational shoppers a luxury experience, even if they’re in the store for a budget purchase.” (01:46)

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Timestamps for Key Segments

• Bankruptcy Announcement & Context – 00:01
• Aspirational Luxury Segment – 00:34-01:19
• Direct-to-Consumer Competition – 01:30-01:46
• Advice for Department Stores’ Survival – 01:46-02:07

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Overall Tone & Takeaway

The episode’s tone is analytical and concise, with a businesslike approach characteristic of Marketplace. The segment highlights how cultural and economic shifts—not just raw consumer spending—are upending established luxury retail. Department stores must adapt quickly, focusing less on exclusivity and more on elevating in-store experiences in a world where luxury brands now reach shoppers directly.

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For further details, listen to the episode for the full Marketplace analysis and insight.

Transcript

[A]

Why are fancy store chains falling into bankruptcy when richer shoppers have money to spend? I'm David Brancaccio in Los Angeles. Let's get context on the parent of Sachs, Neiman's and Bergdorff filing for Chapter 11 protection from creditors this week. The Sachs global bankruptcy will help it reorganize and stay in business. Analysts keep telling us the economy may be weak for lower income people, but that higher income people are generally doing well. Yet these chains of luxury department stores are in deep trouble, Marketplace's Kimberly Adams reports.

[B]

People buying luxury goods often break down into the really wealthy who don't care that much about price, and those who might stretch a bit to buy something nice. Shika Jain is the lead partner for North American retail at Simon Kutcher.

[C]

When it comes to luxury, you know, Saks Fifth Avenue, Neiman Marcus, other players like that are more what I would call in the aspirational luxury, jane says.

[B]

The Saks global brands were getting those aspirational luxury shoppers, but those shoppers are more likely to pull back spending in times of job insecurity and higher prices for everything from housing to health care, especially younger consumers, says lars Perner at USC's Marshall School of Business.

[A]

Many of the incomes have taken more of a hit, so they haven't had the same opportunities to get into luxury products that they would have had when times were better.

[B]

On top of that, luxury department stores are now competing even more with the brands they carry, says Marie Driscoll, a retail expert at Driscoll Advisors.

[C]

What has happened in the last 20 years is many of the luxury brands have opened up their own stores like.

[B]

The Dior, Chanel, Louis Vuitton. To get a foothold in the new luxury retail landscape, Driscoll says, department stores will have to lean into the idea of offering those aspirational shoppers a luxury experience, even if they' store for a budget purchase. In Washington, I'm Kimberly Adams for Marketplace.

[A]

The price of crude oil is down sharply this morning, down about 3.5%, back under $60 a barrel in New York after President Trump dialed down his rhetoric about the US Somehow intervening in Iran amid widespread anti government protests. Every company wants to grow, but anyone who's scaled knows the truth. Growth creates complexity and complexity kills growth. Bureaucracy creeps in, culture frays, and suddenly the energy that built your business starts working against it. If you want unfiltered insight on fighting that drift, check out Founders Mentality. The CEO sessions with executive advisor Jimmy Allen. Each episode, leaders from companies like Audible, Walmart, China and Aws reveal how they stayed fast, focused and human even at massive scale. Founders mentality, the CEO sessions business should be simple. Listen wherever you get your podcasts. The US Government's new limits on immigrants is running into the need to care for America's elderly. The Trump administration is ending a special protected status for 350,000 people from Haiti created after the devastating 2010 earthquake there. Now, unless legal challenges delay this, the temporary protected status for people to live and work in the US Will end early next month. The elder care industry is expected to lose thousands of workers as a result. At a time the US Population needs more of that care. Marketplace's Elizabeth Troval has another story in our series Help Not Wanted about how changing immigration policy is affecting the workforce.

[C]

In a gray uniform, Richard makes the rounds taking out the trash through the halls of Sinai Residences, a retirement community in Boca Raton, Florida. He's one of 26 Haitian staff losing their work permits because of the end of TPS or not using his name if he's deported to Haiti. How fit. Honestly, they killed the president. To Haiti, they can't kill anybody. Since the Haitian president was killed in 2021, violent gangs run much of the country. Richard is 30 and came here a few years ago after a gang attacked him. With the $35,000 or so he earns annually, he's been paying for school to become a licensed practical nurse. Because I love, I love care people. If he loses tps, he'll try to stay in South Florida. He likes the weather, the people. He'll find gig work, but money will be tight. He'll have to stop studying. I didn't save too much because I pay school. No school is very expensive. Around 70% of the workers here at Sinai Residences are foreign born. Many are Haitian.

[A]

Everyone that works here, they've got a.

[C]

Smile on their face. They're like family. That's Murray Rubin, a 92 year old resident who counts these years as the best of his life. Except for when his wife died. We were married for 69 years and the warmth and the empathy that the staff showed. Come ask if there's anything he could do for me. You know you can't put dollars on that. Sinai Residences CEO Rachel Blumberg says not only does the ending of TPS disrupt relationships between residents and staff, it costs money. We've made multiple wage increases to all of our positions, but particularly the positions that are affected by tps. Dishwashers, housekeeping, nursing assistants. She expects the competition for labor to intensify. Boomers are aging at an unprecedented rate than we've ever seen before in senior living. And there's a broader Haitian community impact, too. And wages earned by Haitians here support family back home. Advocate Paul Namfi with the Family Action Network movement says the the US Is turning legal workers into undocumented immigrants, cutting.

[A]

Off people's economic lifeline here, threatening to deport them for Haiti.

[B]

Again, it's lose, lose, lose, because it's.

[A]

Also a loss for the people inside Haiti.

[C]

TPS holder Mary, a certified nursing assistant at Sinai Residences, supports her dad who has cancer back home in Haiti and her four kids here in South Florida. Pray God, do something for us because.

[B]

It'S really hard when you got four kids.

[C]

You can drive so and then you can wait to give them food. So it's really hard. After 20 years in the U. S, she's unsure how she'll provide for her family without being able to legally work in Boca Raton, Florida. I'm Elizabeth Trovall from Marketplace and the.

[A]

Head of the College Athletics association wants the federal Commodity Futures Trading Commission to put a stop to predictions markets on college sports, which offer a kind of unregulated betting. The NCAA's Charlie Baker says he is, quote, imploring federal regulators to pause these markets until the rules are tightened. He called for restrictions by age and on advertising. He called for ways to prevent athletes from getting harassed and for more safeguards to prevent the rigging of predictions markets. In Los Angeles, I'm David Brancaccio with the Marketplace morning Report from APM American Public Media. Hey, everybody, it's Kai Rysdal, the host of Marketplace. It has been a year since the fires here in Los Angeles and businesses that burned are still struggling.

[C]

You know, I won't lie.

[B]

I've looked, I've looked at, you know.

[A]

Hey, maybe, maybe we move the store. Just it wouldn't be the same hardware store on the ground reporting and what the year ahead has in store for business owners still recovering. Listen to Marketplace on your favorite podcast. Apparently.