Saks Ends Amazon E-commerce Partnership Amid Bankruptcy

Saks Terminates Amazon Partnership Amid Restructuring

Bankrupt retailer Saks Global is officially ending its "Saks on Amazon" partnership, according to a source with direct knowledge of the matter. The company is exercising its right under Chapter 11 bankruptcy to reject the contract and will wind down its Amazon storefront to focus on its primary e-commerce channel, Saks.com.

Overview of the Situation

The partnership, which began with a $475 million investment from Amazon in 2024, required Saks to pay the e-commerce giant at least $900 million over eight years. However, the collaboration struggled with limited participation from top luxury brands concerned about brand dilution. The relationship further deteriorated during bankruptcy proceedings, leading to legal disputes over collateral for a $1.75 billion loan.

Impact on the Market

This decision underscores a strategic pivot for Saks to consolidate its luxury brand image and drive traffic to its own platform, where it has more control over branding and margins. For Amazon, it represents a setback in its efforts to penetrate the high-end retail market. The termination may lead to further legal battles concerning the original financial agreement.

Summary

Saks is prioritizing its core business by ending its troubled Amazon partnership. The focus now shifts to how Saks will leverage its own platform for growth and the resolution of any remaining legal disputes with Amazon.

FAQ

Q: Why did Saks end its partnership with Amazon?
A: Saks ended the partnership to focus on its own e-commerce platform, Saks.com, due to limited brand participation and as part of its Chapter 11 bankruptcy restructuring.

Q: What was the financial deal between Saks and Amazon?
A: Amazon invested $475 million in Saks' business, and Saks agreed to pay Amazon at least $900 million over an eight-year period.

Source: Investing.com