San Francisco's Retail Scene

[coyotetrickster]

Not true. Banana Republic's Grant St. Store is a flagship store as is the William Sonoma on Post. Both are SF-based retailers.

[dimondpark]

So much for the SF flagship conspiracy of '06.

[dimondpark]

Originally Posted by coyotetrickster

Not true. Banana Republic's Grant St. Store is a flagship store as is the William Sonoma on Post. Both are SF-based retailers.

Isnt the old navy on market and 4th supposed to a flagship also?

[LosAngelesBeauty]

Flagship means your biggest, highest-performing, and/or top store in the chain or area. That's common knowledge in the fashion industry.

SF DOES have the flagship stores for Banana Republic, which is impressive. Not all flagships are in NY or LA. The flagship Neiman Marcus is not in Beverly Hills, but Dallas, for example. And Nordstrom's flagship is in Seattle.

[BTinSF]

Originally Posted by dimondpark

Isnt the old navy on market and 4th supposed to a flagship also?

Well, since it's also part of Gap, Inc, headquartered here, I'd say it is. Having been in their stores in NYC and Chicago, I can tell you it's the largest store--so big, in fact, that they seem to have shut down the basement more of less permanently. From everything I've read, the Bloomingdales will also be "the West Coast Flagship" in the sense that it'll be the biggest store after the one in New York.

Aside from the physical size of the store, it's hard for a store which is not also among any chain's largest volume sellers to claim flagship status and downtown SF stores typically do very high sales volumes, both total and per square foot. I'd also wonder if, even in the case where SF stores aren't physically as large as the ones from the same outfit in "Beverley Hills" or somewhere else NEAR LA, if they don't do higher sales volumes.

[shrek05]

SF DOES have the flagship stores for Banana Republic, which is impressive. Not all flagships are in NY or LA. The flagship Neiman Marcus is not in Beverly Hills, but Dallas, for example. And Nordstrom's flagship is in Seattle.

Thats only cuz Neimans began in Dallas and Nordstroms began in Seattle. But many stores have multiple flagships, Dallas has several flagships. NYC/LA arent the only ones.

downtown SF stores typically do very high sales volumes, both total and per square foot SF stores aren't physically as large as the ones from the same outfit in "Beverley Hills" or somewhere else NEAR LA, if they don't do higher sales volumes.

SF stores dont have higher sales volumes. Most major brands such as LV, Tiffany's, Bvlgari all have their highest performing stores in the LA region. I think the only reason the companies brand the SF stores as flagships is to attract more people. But some stores in SF have mediocre sales, such as Ferragamo and as a result Jimmy Choo (similar category/competitor) hasnt opened an SF location (though I don't know if they are planning recently but that was a reason back during Jimmy Choo's major US expansion).

[LosAngelesBeauty]

^^^ The Westside and South Coast Plaza have some of the highest performing stores in North America. Most designers actually do best worldwide in Japan, etc. But Beverly Hills and the Westside in general is a juggernaut in the luxury market. How can you tell? Go to the boutique next time you're Union Square and ask about their "Ready-To-Wear" collection. Buyers for designers will only allow a boutique to carry what can sell in the area. Most of the time, you're not going to get the highest couture collection in SF. Surely not as extensive as the couture collection in Beverly Hills. You can definitely have high-volume like Honolulu does. They have the highest performing Louis Vuitton in North America because so many girls there (tourist mostly) buy their hand bags in BULK! But that doesn't mean it'll carry prestigious couture lines.

And mature luxury markets like the Westside do not just depend on tourists to sustain their high-rents (Rodeo has the 4th highest rent after New York's 3 major shopping districts). They have built up a loyal and extensive client list that sometimes buy the entire new season. That adds up to SOMETIMES hundreds of thousands of dollars for each client.

So don't be fooled by how many people are walking around the stores to gauge how well the store is doing. Take a look inside at their Ready To Wear and see what pieces in their collection is there. But then again, you would not know what is missing unless you keep up with the industry! haha

[craeg]

" They have the highest performing Louis Vuitton in North America because so many girls there (tourist mostly) buy their hand bags in BULK!"

Actually that is not possible. Trust me on this, I know.
LV severely limits the amount of leather goods customers can buy. Nobody buys LV in bulk. The very notion of such a thing is anti-LV.

Also the highest performing LV store is not Honolulu. Where are you getting these facts from.

[shrek05]

actually Honolulu might be the best performing store now, I had forgotten that LV greatly increased the size of the Hawaii store for having superior sales. There was an article saying how the Honolulu store sold so much because of the Japanese tourists that go there all the time (same with the Chanel store I believe).

(You can buy multiple LV bags, unless its a special edition bag, ive seen lotsa people purchase 3-4 bags, sometimes more, at once, which I think thats what he means "in bulk", ive seen some at las vegas that buy more than that many at once, mainly tourists as many of these items are a little more expensive in asia)

But LABeauty, Im pretty sure the SF store carries a lot of the clothing. The one at Union Square is quite large.

[fflint]

People seem to be throwing around claims willy-nilly. Don't make claims as to which stores sell the most, for instance, unless you are prepared to provide sources used to reach that conclusion. Enough with the unsupported claims already.

[shrek05]

just supporting LABeauty, I found the facts, craeg I dont know where you came from so quickly saying LABeauty was wrong

The two-level, 7,500-square-foot Ala Moana unit is expected to do between $50 million and $100 million in annual sales, said Jean-Marc Gallot, chief executive officer of Louis Vuitton North America. Louis Vuitton is popular enough in Hawaii to support six stores, with units also at Honolulu Gumps, Honolulu Hilton, Maui Lahaina, Maui Wailea and Waikoloa.

"We have gigantic sales of Louis Vuitton in Hawaii," Gallot said. "Hawaii contributes more than 20 percent of [total] sales in North America. The Hawaiian market is absolutely key and essential because of the future. We see a recovery of Japanese tourists to pre-9/11 levels. There's been a 5 percent increase year to date."

--WWD Magazine
The new store is expected to rival or surpass NYC. LA's Beverly Hills location had once been the most profitablee, however, the LA area now has many stores as well with both the BH and SCP locations doing very well.

[craeg]

I work for LV, and I have direct access to the sales figures.
Honolulu is not the highest performing store, and you cannot just buy however many bags you want.

[shrek05]

These figures are also released through press releases and analyst reports. I agree with you that Honolulu does not have the highest sales. The highest sales in North America were in la until 2004 when LV opened the new flagship in Manhattan on 57th which became the highest selling. However, Honolulu, currently second, is expected to match or even surpass the Manhattan location.

I dont know what LV store you work at and maybe its a rule that is just often disregarded but Ive seen people at the Costa Mesa, LV and Scottsdale locations purchase multiple bags.

On a different note, moving away from this useless bicker, Juicy Couture opens soon in SF and has high expectations. It is one of the 14 that will open this year.

[fflint]

Here's the Chronicle's article on the coming of Barney's flagship to San Francisco:

Barneys plans to dress up Union Square
Retailer set to convert FAO Schwarz site into flagship store

Pia Sarkar, Chronicle Staff Writer
Wednesday, June 28, 2006

Luxury retailer Barneys New York will take over the long-vacated FAO Schwarz building on the corner of Stockton and O'Farrell streets in San Francisco, blotting out one of the last remnants of the economic recession in the Union Square shopping district.

On Tuesday, Barneys revealed plans to convert the three-level, 60,000-square-foot store into its fifth flagship location by next fall. The company also operates stores in New York, Beverly Hills, Chicago and Boston, and will open two more stores, one in Dallas and the other in Las Vegas.

"Opening a San Francisco flagship has been an objective of our company ever since Barneys ... commenced its expansion outside of New York several years ago," said Howard Socol, chairman and chief executive officer, in a statement. "We are thrilled to be able to make that dream a reality in a location in the heart of Union Square."

Barneys, established in 1923, is known for its high-end fashion, catering to a clientele willing to spend $1,130 for a silk tank dress by Dries van Noten or $485 for a pair of metallic slingback wedges.

For Union Square, the presence of Barneys signals yet another step toward full recovery after the dot-com crash, which had scared away businesses and created double-digit vacancy rates in the area.

FAO Schwarz, which had occupied 48 Stockton St. since 1989, closed in 2002. Its bright red sign and darkened windows served as a constant reminder of what once was. Although several other stores around it had also gone out of business, replacements eventually moved in, leaving the one corner of Stockton and O'Farrell streets particularly lonely.

"Anytime you have an empty storefront, it's a visual blight," said Linda Mjellem, executive director of the Union Square Association. "It's reminder that the area has fallen on hard times."

Barney's decision eliminates that reminder and exemplifies how far Union Square has come in the last few years. "We're really excited," Mjellem said. "We think (Barneys) is an excellent fit for the area. It'll give shoppers one more reason to come downtown or across the bay."

Last year brought a number of stores to Union Square, including Zara, Borrelli, Stuart Weitzman Shoes, Lucky Brand Jeans, Cody's Books and H&M. The shopping district is expecting two more additions this year: Mango and American Apparel. Meanwhile, the expansion of the nearby Westfield San Francisco Centre on Market Street is near completion, including a Bloomingdale's scheduled to open in the fall.

Rumors about Barneys coming to Union Square had been circulating for some time. The company had been negotiating a lease in San Francisco for 18 months.

Its parent company, Jones Apparel Group, is considering seeking a buyer. Bain Capital, a private-equity firm, is reported to be the lead contender to acquire the company.

In April, Jones Apparel reported first-quarter profit plunged by 70 percent, falling to $25.8 million (22 cents per share) from $87 million (71 cents) a year ago in the same period. The results included a $45.1 million loss from the sale of its Polo Jeans Co.

Same-store sales, sales at stores open at least a year, were up slightly, with an increase of 1 percent, excluding Barneys. Same-store sales at Barneys climbed 7 percent.

Jones Apparel is the fourth-largest apparel company in the country. Besides Barneys, it owns Nine West, Enzo Angiolini, Bandolino, Joan & David and Anne Klein, among others.

Barneys was acquired by Whippoorwill Associates and Bay Harbour Management in 1999, after being bailed out from bankruptcy proceedings. In 2004, Jones Apparel bought the company for $294.3 million in cash.

[EastBayHardCore]

Originally Posted by BTinSF

LABeauty can call a store in Beverley Hills a "flagship" if she wants, but she can't count it as a downtown LA store.

pwn3d.

LOLZ at "she" too.

[BTinSF]

Originally Posted by EastBayHardCore

pwn3d.

LOLZ at "she" too.

In English? I do take it you're telling me that "LABeauty" is a he, though. OK.

Concerning the LV dispute, it wouldn't surprise me at all that the Honolulu store has their best sales. Anybody who has been there has seen not only the Japanese love of luxury branded accessories but also the hoards of Japanese tourists flocking to Hawaii. It does make sense--even if they have to buy the bags one at a time.

[dimondpark]

Originally Posted by LABeauty

Interesting how often SF's papers call retail "flagships."

with respect to Barney's-its their own CEO who called the SF store a flagship

"Opening a San Francisco flagship has been an objective of our company ever since Barneys ... commenced its expansion outside of New York several years ago," said Howard Socol, chairman and chief executive officer, in a statement. "We are thrilled to be able to make that dream a reality in a location in the heart of Union Square."

Originally Posted by Shrek05

SF stores dont have higher sales volumes. Most major brands such as LV, Tiffany's, Bvlgari all have their highest performing stores in the LA region.

SF stores do indeed have high sales volume-dont be preposterous- otherwise why would LV have 3 Bay Area stores(6 if you count mini-boutiques inside Dept stores), Gucci have 2 and Tiffany 4 Bay Area stores? All of which had their first local boutiques in Union Square-many of these opened up last year or the year before-not the sign of a weak market-to say the least.

Originally Posted by LABeauty

And mature luxury markets like the Westside do not just depend on tourists to sustain their high-rents (Rodeo has the 4th highest rent after New York's 3 major shopping districts).

Well, according to this report released Summer 2006, Union Square is 2nd to Fifth Avenue in rents

Retail Area Rents per sq ft
1 Fifth Av(48th-59th) New York $800.00 psf
2 Union Square-San Francisco $330.00 psf
3 Rodeo Drive-Beverly Hills $300.00 psf
4 Michigan Av@Oak St-Chicago $262.50 psf
5 Valley Fair-San Jose $200.00 psf
6 Bloor St-Toronto $180.00
7 Newbury St-Boston $165.00 psf
8 Robson St-Vancouver $162.54 psf
9 Ward/Kakaako-Honolulu $156.00 psf
10 St Catherine St-Montreal $112.88 psf

http://www.grubb-ellis.com/pdf/natmr...rendretail.pdf

[dimondpark]

From the SF Business Times

When it opens in 2007, Barneys will be the sixth department store within a five-block radius, joining the much-hooplahed Bloomingdale's flagship scheduled to open in September, Nordstrom, Macy's flagship, Neiman Marcus and Saks.

[shrek05]

SF stores do indeed have high sales volume-dont be preposterous- otherwise why would LV have 3 Bay Area stores(6 if you count mini-boutiques inside Dept stores), Gucci have 2 and Tiffany 4 Bay Area stores? All of which had their first local boutiques in Union Square-many of these opened up last year or the year before-not the sign of a weak market-to say the least.

No one ever said LV doesnt have high sales in SF, all I said was it doesn't have higher sales than LA (which is hard to beat), luxury stores in the silicon valley (at Santana Row and Stanford Shopping Center) both have very high sales. No one is denying that the bay area has strong sales, just not as strong as its southern counterparts, but thats not really saying much as luxury stores in socal have ridiculous sales. the LV in SF is going to have higher sales than say the LV in my town, i think thats obvious...

When it opens in 2007, Barneys will be the sixth department store within a five-block radius, joining the much-hooplahed Bloomingdale's flagship scheduled to open in September, Nordstrom, Macy's flagship, Neiman Marcus and Saks.

Thats pretty exciting. I think the new Bloomingdale's will be the largest in the west thus far.

[dimondpark]

Originally Posted by shrek05

No one ever said LV doesnt have high sales in SF, all I said was it doesn't have higher sales than LA (which is hard to beat), luxury stores in the silicon valley (at Santana Row and Stanford Shopping Center) both have very high sales. No one is denying that the bay area has strong sales, just not as strong as its southern counterparts, but thats not really saying much as luxury stores in socal have ridiculous sales. the LV in SF is going to have higher sales than say the LV in my town, i think thats obvious...

oh i see,
but BTinSF didnt specify the most uspcale stores-he could have been referring to Department Stores-in the which case, Id be willing to bet sales are higher in Union Square then in BH-simply because DT SF has more people with money walking the streets at any given time and perhaps arent going to drop 100K on couture but certainly would spend a few hundred at Macy's or Nordstrom-totally conceivable and highly probable.