For a look at how the economy's affecting the affluent -- or, at the very least, rich women who don't mind overspending on clothes and accessories -- look no further than Dallas-based Neiman Marcus, which yesterday turned in its FY 2009 first-quarter numbers and reported an 84-percent plunge in net profit. Says the company in its report filed with the Securities and Exchange Commission: "We expect retail demand and revenues will remain weak for an extended period of time. Based on our inventory levels, we expect higher markdowns compared to the prior year will be required to reduce Fall season merchandise resulting in lower gross margins in the second quarter of fiscal year 2009." Which means, of course: Sale!
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The company has also decided not to open any more of its Cusp stores for the rest of the fiscal year; it'll find some other way to move togs aimed at the fashionable younger lady. But Neimans president and CEO Burt Tansky doesn't seem too worried ... for now. "This reflects a weakness of both our aspirational shopper and the loyal customer," he says of the slump in sales. "We believe the loyal customer still has the ability to shop with us. Though she may have reduced her spend, we believe she will return to a much more normal pattern of shopping." --Robert Wilonsky