Barneys chief executive Howard Socol plans to resign, according to "people knowledgeable about the situation," the New York Times reports. In August Barneys was sold to Istithmar, the investment branch of the Dubai government, and Socol reportedly disagrees with the new owner's plans for overseas expansion.
International expansion has proved a challenge for many American luxury brands, which must confront a patchwork of foreign regulations that they fear will hamper their business. Sometimes they are required to take on local business partners and give up some control, tricky terrain for retailers whose brand image is the core of their business.
…Since Istithmar emerged as the victor in a bidding war last summer, Barneys has been more aggressive in its pursuit of hot designer exclusives and regained some of the irreverent, experimental attitude that once made the store seem so hip.
Socol brought Barneys out of bankruptcy in the nineties, helping it recover from a $100 million debt and return to profitability. His strategy included landing exclusive deals with hot up-and-coming labels like Proenza Schouler while bringing in designers like James Perse and Rag & Bone. Other Barneys exclusives — ones perhaps more indicative of the experimental attitude — include Kate Moss's line for Topshop (which never seemed that popular) and selling Rogan's Target line this weekend, which befuddled some retail analysts.
If expanding internationally has been a challenge for "many American luxury brands," we can only imagine how hard it might be to maintain Barneys' delicate balance of awesomeness abroad. Socol is largely responsible for the store we know and love; it will be interesting to see if it can maintain its cachet in his absence (though we think it can). At least Simon Doonan doesn't seem to be going anywhere.