Jun. 11--Neiman Marcus is rolling back its store hours in about half of its 40 locations nationwide -- and two of its four locations in North Texas -- as the recession causes even wealthy consumers to curb their luxury spending.

The decision to change operating hours was announced as the company posted a fiscal third-quarter loss of $3.1 million Wednesday, its second consecutive quarter in the red.

The Dallas-based luxury retailer plans to close its store at the Shops at Willow Bend in Plano an hour earlier Monday through Friday and open its Fort Worth location an hour later on Sundays, company spokeswoman Ginger Reeder said.

Neiman Marcus' downtown Dallas and NorthPark Center locations will maintain the same hours.

The decrease in hours is an attempt to better align the stores with when customers shop, Reeder said. By cutting hours, the retailer can save on overhead expenses such as payroll.

Neiman Marcus, like many other high-end retailers, is feeling the pinch of the recession on its sales. The company reported that same-store sales, or sales in stores open for at least one year, declined 25.1 percent in the quarter.

"Our customers are reacting to the economy and its strain on their investments, their incomes and their outlooks. It may be that our greatest obstacle to recovery is the psychology of the times," chief executive Burt Tansky said in a call with analysts.

The decreased same-store sales and sales-driving measures such as markdowns and promotions were cited as revenue fell 23.7 percent to $810 million from $1.06 billion a year ago.

"Luxury retail is in a lot of trouble. They are discovering how much of their sales came from aspiration shoppers, or shoppers spending bonuses in advance, and now those bonuses aren't coming in," said Candace Corlett, president of WSL Strategic Retail, a retail research firm in New York.

"It is no longer chic to overspend, and that is whacking stores like Neiman Marcus," she said.

Tansky said Neiman Marcus customers have not been sensitive to price changes in the past, but he acknowledged a "mindset shift" that has led many customers to place more emphasis on value vs. quality.

Tansky said Neiman Marcus stores will be "vigilant with their relationship between value and quality," but he assured customers that the stores would not be "trading down." The same merchandise mix from the same vendors will be available, but more options at different prices will be included.

"The luxury industry is going to have to return differently," Corlett said. "No longer will people buy another $700 black bag if they already have three. Products have to be new and different now."

<< -- 06/12/2009>>