Barneys New York

Barneys New York
Private
Industry Retail
Founded 1923
Founder Barney Pressman
Headquarters 575 Fifth Avenue, New York, New York
Number of locations
 27
Products Clothing, footwear, bedding, furniture, jewelry, beauty products, and housewares.
Owner Perry Capital
Website barneys.com

Barneys New York is an American chain of luxury department stores founded and headquartered in New York, New York.

Barneys New York primarily competes with luxury department stores Saks Fifth Avenue, Bergdorf Goodman, and Neiman Marcus, as well as Bloomingdale's, Lord & Taylor, and Nordstrom.

The chain operates 27 flagship, boutique, and outlet stores in the United States. In addition, eleven stores in Japan are licensed and operated by a third party.

History

60th St flagship store

Pressman family ownership

The company began in 1923, when Barney Pressman opened his first store in Manhattan with $500 raised by pawning his wife's engagement ring in order to lease a 500-square-foot (46 m2) space at Seventh Avenue and West 17th Street in Manhattan with 20 ft (6 m) of frontage. Barney's Clothes was stocked with 40 brand name suits and a big sign with a slogan, "No Bunk, No Junk, No Imitations." Barney's sold clothing at discounted prices by purchasing showroom samples, retail overstocks, and manufacturers' closeouts at auctions and bankruptcy sales. It also offered free alterations and free parking to attract customers.

Barney Pressman claimed to be the first Manhattan retailer to use radio and television, beginning with "Calling All Men to Barney's" radio spots in the 1930s that parodied the introduction of the Dick Tracy show. He sponsored radio programs featuring Irish tenors and bands playing jigs to advertise Irish woolens. Women encased in barrels gave away matchbooks with the store name and address. He also chartered a boat to take 2,000 of his customers from Manhattan to Coney Island.

In a 1973 interview with Business Week, Fred Pressman, Barney Pressman's son, became "convinced that the discount route definitely was not for us. My father and I have always hated cheap goods.... I didn't want to sell low-end merchandise. Now, many of those who chose to are verging on bankruptcy." Fred Pressman's New York Times obituary stated:

With his father's blessing, Fred Pressman slowly transformed the store from a salty discount house that sold roast beef sandwiches in its pub to a purveyor of Italian designers with a cafe serving Perrier and light salads. He began to discard the types of suits that his father was prone to unearthing at auctions and bankruptcy sales, peppering the racks instead with then-obscure and top-name designers both, but continued to offer touches like free alterations that gave Barneys its reputation.

Pressman is quoted saying, “The best value you can offer a customer is personal attention to every detail, and they will return again and again. Ultimately, the customer cares the most about how he or she is treated." Pressman died in July 1996.[1]

In 1970, Barney's built a fifth story onto their original building and a five-story addition. The original store was renamed America House and the addition was named International House. The expanded store occupied the entire Seventh Avenue block (between 16th and 17th streets), with 100,000 square feet (9,300 m2) of selling space and 20 individual shops.

International House, Fred Pressman promised, would feature complete collections of European designers, "from denim pants to $250 suits," not just a watered-down "potpourri of fabrics and models." The renovated America House, he said, would hold merchandise from "manufacturers who are in effect designers."

By 1973, the store was stocking 60,000 suits. It carried the full lines of designers such as Bill Blass, Pierre Cardin, Christian Dior, and Hubert de Givenchy. It became the first clothing store in the U.S. to stock the full line of Giorgio Armani, after signing an agreement in 1976. Barneys is widely credited to have introduced Giorgio Armani to the American public.[1]

Women's clothing was introduced in 1976 on the third floor of the International House. The next year, the women's store relocated to The Penthouse, a new top-level enclosure. Barney's also added housewares, cosmetics, and gift departments to the store. Also in 1977, Barney's in-store restaurant was renamed The Cafe and began selling salads, soup and sandwiches.

The apostrophe in Barney's was dropped in 1981. In 1981, the women's penthouse became a duplex. Barneys imported 80% of the women's and 40% of the men's merchandise. The $25 million, 70,000-square-foot (6,500 m2) women's store finally opened in 1986 in a row of six townhouses and two larger adjacent buildings across the store along 17th Street. The addition included a unisex beauty salon and restaurant, antiques, and accessories, gifts, and housewares departments. It accounted for about one-third of Barneys' sales of some $90 million the following year.

In 1988, Barneys opened a 10,000-square-foot (930 m2) men's store in the World Financial Center. In 1993, the store abandoned its Seventh Avenue flagship, moving to the current 230,000-square-foot (21,000 m2), 9-story, Kohn Pederson Fox - designed Manhattan store on Madison Avenue at East 61st Street. It was the largest new store in New York City since the Great Depression. The store is a 22-story building with 14 floors of offices above the store. The wood floors, a marble mosaic on the lobby floor, gold-leaf ceilings, and lacquered walls of the new Barneys store cost $267 million, according to one source.

Barney’s opened its first store outside of Manhattan in Chicago, Illinois, in 1993, closely followed by another large store in Beverly Hills, California, in 1994. During this time, they also announced a national expansion of 30 smaller stores that range around 6,500 square feet.[2]

1996 bankruptcy

The company filed for Chapter 11 Bankruptcy in 1996, closed most of their boutique stores (including locations in Dallas and Houston, Costa Mesa, Cleveland, Short Hills, and Manhasset), and sold the department stores in Japan and Singapore .

2000 to Present

On December 20, 2004, the Pressman family sold its less than 2% remaining ownership to the Jones Apparel Group, which in turn sold the company in September 2007 to Dubai-based private equity firm Istithmar PJSC for $937.4 million.[3] Included in this purchase is an estimated $500 million in debt. "The luxury market took a sharp turn for the worse after Istithmar's acquisition of Barneys. U.S. sales of high end clothing, fragrances and accessories slipped 14% in 2009, according to Bain & Co. Although luxury was a star performer over the 2010 holiday season, spending trends have yet to recover to pre-recessionary levels. The privately held company doesn't reveal financial results but said that EBITDA rose by $30 million in 2010."[4]

Howard Socol, Barneys' former CEO, resigned shortly after the change in ownership. The company failed to fill the position for over two years until Mark Lee was appointed in September 2010. Lee is the former chief executive of Gucci Group and has consulted and sat on the board of many other fashion companies.[5] Since Lee’s appointment, Barney’s has experienced changes in its staff, advertising, and website. Amanda Brooks, former creative director of Hogan, replaced long time fashion director, Julie Gilhart.[6] Lee’s former Gucci colleague, Daniella Vitale, replaced Judy Collinson as head merchant.[4] Former creative director Simon Doonan, now creative ambassador-at-large, was replaced by Dennis Freedman.[7]

Barney’s advertisements and catalogs are usually shot in-house, but for Spring 2011 candid shots by art photographers such as William Klein, Nan Goldin and Juergen Teller were taken behind-the-scenes during New York Fashion Week. Some existing stores will face new renovations such as the in Madison Avenue location’s main floor and Co-Op levels. The traditional red awnings have been changed to black. Barneys' website has been revamped and has launched a new site called “The Window” which is the retailer's primary "social media landing page"—a window into the Barneys world, with news about fashion and happenings at Barneys stores.[4][8]

As of February 2011, Barneys no longer sells Prada with the exception of shoes and menswear because of disagreements concerning prices and inventory control. Prada wanted to lease a space, but control its own inventory and markdowns under a concession model. Barneys declined.[4]

In December 2013, Women's Wear Daily announced that the retailer will be returning the portion of its original Seventh Avenue site being vacated by bankrupt Loehmann's. In January 2014, Barneys will use transgender models in advertisement for its 2014 advertisement campaign.[9]

In February 2016, Barneys New York returned to its original Seventh Avenue location in Chelsea opening a four story Flagship store. [10]

Perry Capital ownership

In May 2012, the majority of it was acquired by Perry Capital which reduced the company's $590 million debt to $50 million. It will have three seats on the seven-member board. The former majority owner Istithmar World as well as new investor Yucaipa Cos will also be on the board as will current CEO Mark Lee.[11]

Stores

Barneys New York operates sixteen flagship, regional, and boutique department stores in the United States.[12]

(*denotes a former CO-OP store)

Fred's restaurants operate inside of the Beverly Hills, Madison Avenue, and Chicago locations.[13]

A Barneys New York flagship in Dallas, Texas at Northpark Center closed in the Spring of 2013.[14]

Eleven outlet stores operate in addition to the company's full-line business. Five full-line Barneys stores and six outlet stores operate in Japan under a third party licensee.[15]

Barneys New York CO-OP

Established in 1986,[16] the Barneys New York CO-OP originally existed as the contemporary department within Barneys flagship stores. Created to house trendier and less expensive product than the rest of the store, the CO-OP was aimed at younger shoppers with smaller budgets than a traditional Barneys customer. The CO-OP department was spun off into a separate chain of stores in the 2000s, primarily located in shopping malls and lifestyle centers. At its height, there were more than 20 CO-OP stores throughout the United States.

These stores operated at:

(*converted to Barneys New York store)

In 2013, Barneys retired the CO-OP name. Several CO-OPs were converted into boutique versions of the flagship Barneys New York brand, but a majority were closed.[17]

Controversies

Use of "Co-op" in name

The 2010 opening of the Brooklyn, New York CO-OP location raised some concerns among members of the Park Slope Food Coop regarding the use of the term "co-op" by a for-profit corporation. According to the general manager of the Food Coop, Barneys's use of the term is a violation of the New York State Cooperative Corporations Law.[18]

Racial profiling

Barneys has been repeatedly accused of racially profiling its customers throughout the years. In 1996, Johnnie Roberts, a journalist for Newsweek, published an account of an incident taking place in the spring of 1990 in which he was mistakenly accused of shoplifting because of being an African American.[19]

In 2013, Trayon Christian, a 19-year-old African American, purchased a $350 Ferragamo belt and was arrested shortly after leaving the store. The police had received a call from the store claiming that the debit card used was fraudulent even though the customer provided proper identification at the time of the purchase. The officers questioned Trayon on how he was able to afford the purchased belt and accused him of using a fraudulent card. He was handcuffed, detained in a holding cell for two hours and interrogated further. He was later released after the police contacted Chase Bank to verify ownership of the card.[20]

Another African American shopper, Kayla Phillips, has also come forward with a similar claim after she purchased a $2,500 Céline handbag with her debit card. Both shoppers believe they were targeted because of their race after they purchased costly items and have stated they intend on filing discrimination lawsuits against the store.[21]

As a result of these high-profile cases, Al Sharpton has threatened to boycott the store and has compared its racial profiling to the "Stop-and-Frisk" policy practiced by the NYPD, a practice that was later deemed unconstitutional by a US District Court.[22] Fans have also petitioned Jay-Z to sever his ties and partnership with the retailer.[23]

After much debate and speculation, mogul Jay Z spoke out in what many believe to be a watered down reaction, with critics claiming that he is selling out his own people in order to gain profits. Going further, New York newspaper Daily News claimed that he must either back away from his partnership with the chain or face "Zero Respect".[24] However, Jay Z responded saying that he would look into the matter more thoroughly rather than make a snap judgment, citing that "I move and speak based on facts and not emotion."[24] A few days later, Jay Z spoke out again stating that his deal with Barneys would continue as planned, with the condition that he be placed in a leadership role on a committee specifically organized to deal with racial profiling in the store.[25] Also, more conditions will be added to this deal. All of the proceeds of the BNY SCC collection will be donated to Jay Z's charity, the Shawn Carter Scholarship Foundation. This is a major increase than the original 25% of the proceeds that was initially agreed upon. As well, Barneys also agreed to donate 10% of all retail of all stores nationwide as well as their webstore, Barneys.com, on November 20, 2013, which would guarantee a total of at least 1 Million dollars.[25]

References

  1. 1 2 "Barney's Fred Pressman, 73". The New York Times. Retrieved 4 March 2011.
  2. ↑ "Company News; Barneys to Open California Store". The New York Times. 8 June 1989. Retrieved 4 March 2011.
  3. ↑ Jones New York 2007 Annual Report
  4. 1 2 3 4 Dodes, Rachel (5 February 2011). "Barneys, Prada in Tussle". The Wall Street Journal. Retrieved 4 March 2011.
  5. ↑ Dodes, Rachel (24 August 2010). "Barneys Brings in Gucci Veteran". Wall Street Journal. Archived from the original on 26 January 2011. Retrieved 4 March 2011.
  6. ↑ Akhtar, Amina. "Amanda Brooks Named Fashion Director of Barneys New York". FashionEtc. Retrieved 4 March 2011.
  7. ↑ Akhtar, Amina. "Simon Doonan Out as Creative Director of Barneys New York". FashionEtc. Retrieved 4 March 2011.
  8. ↑ Horyn, Cathy (4 February 2011). "Barney's New Chief Explains Those Changes". The New York Times. Retrieved 4 March 2011.
  9. ↑ Edelson, Sharon (30 January 2014). "Barneys New York Taps Transgender Models". WWD. Retrieved 31 January 2014.
  10. ↑ Berlinger, Max. "Barneys Celebrates Downtown Opening With Leather Jacket Charity". New York Times. Retrieved 14 April 2016.
  11. ↑ "Two new board members". The San Francisco Chronicle.
  12. ↑ "Barneys New York store locations".
  13. ↑ "Fred's Restaurants at Barneys New York".
  14. ↑ Maria Halkias (8 October 2012). "Barneys New York is closing its only Dallas store at Northpark". The Dallas Morning News.
  15. ↑ "Barneys New York Japan store list".
  16. ↑ "Barneys N.Y. Ending Co-op Brand". VMSD.com.
  17. ↑ Lydia Dishman (6 March 2013). "Barneys Rebranding Co-op Stores Signals the Start of a More Luxe Era". Forbes.
  18. ↑ Stephen Brown, "Is the Barneys Co-op breaking the law — with its name?" The Brooklyn Paper, April 15, 2010
  19. ↑ Kim Bhasin, "Barneys' Racial Profiling Problem Stretches Back At Least 20 Years" Huffington Post, October 25, 2013.
  20. ↑ "Student sues Barneys department store, NYPD, alleges racial profiling" CNN, October 25, 2013.
  21. ↑ "Barneys, NYPD under fire for alleged racial profiling" CBS News, October 25, 2013.
  22. ↑ "Macy's joins Barneys in brewing NYC 'shop-and-frisk' scandal" Reuters, October 26, 2013.
  23. ↑ "Jay Z's Barneys collection protested after racial profiling claims" Los Angeles Times, October 25, 2013.
  24. 1 2 Danton, Eric. "Jay Z Hits Back on Criticism Over Barneys Partnership". The Rolling Stone. Retrieved 3 May 2014.
  25. 1 2 Wilson, Julee. "Jay Z Confirms Barneys Collaboration Is Still On, But With A Few Conditions". The Huffington Post. Retrieved 3 May 2014.

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