I love Barneys New York. I think in a world where department stores are homogeneous, staid and overall unexciting, Barney’s continues to please by featuring an interesting edit of designers, from Jeffrey Monteiro at the CO-OP to Valextra in the accessories department to Michael Bastian in men’s. They’ve also kept the decor looking fresh under Simon Doonan’s creative direction. (I mean, who else would do SNL-themed holiday windows?)
Maybe my appreciation of Barneys as a consumer is the reason I can’t help but scream inside when I think about what’s happened to the company’s finances over the last few years.
Here’s a little story for you. Back in the ’90s, Barneys attempted to grow up too fast, expanding wildly beyond its means, and eventually filing for bankruptcy protection in 1996. The store was (obviously) saved, and much of this is documented in a really good book called The Rise and Fall of the House of Barneys.
A while later–2004, specifically–Jones New York bought Barneys in an attempt to infiltrate the luxury market. That didn’t work, so Jones sold Barneys to a Dubai investment firm called Istithmar in the summer of 2007. The owner of Uniqlo also wanted to buy Barneys, but Istithmar offered more money–$825 million, to be exact.
And here’s where our current problems start. Istithmar didn’t know anything about running a luxury retailer. Barneys beloved CEO Howard Socol bailed after one year under the investment firm because it was so difficult to work with them. Since then, Barneys hasn’t had a CEO. Combine that with a tumbling economy, and you can explain why the retailer was yet again on the verge of bankruptcy by September 2009.
In this morning’s WWD, there’s a big story about what Istithmar CEO David Jackson’s departure on Tuesday might mean for Barneys: Will they finally get a new CEO?
I say, forget about that, Istithmar. Sell Barneys to someone who knows what they’re doing, such as Holt Refrew owner Galen Weston, who was rumored last year to be interested in buying the store. Cut your losses now while it’s still possible. And save Barneys.