MOVING ON UP AT DILLARD’S

I had the good fortune to catch up with Bill Dillard at the recent Chicago Collective. Here, excerpts from our conversation. (Above: Jim Northrup, Thomas Dillard, Bill Dillard, and Jamie Davidson.)

With no Dillard’s stores in my tri-state neighborhood, I always assumed that Dillard’s was somewhere between a Macy’s and a Nordstrom. Is that an accurate assessment?
If those are your two poles, we are closer to Nordstrom than Macy’s.

Then you’ve clearly upgraded in recent years. How did you manage that?
Our business right before Covid had been promotional. Like most department stores, we were overbuying and then marking down in season. But since everyone was doing it, it felt like this was simply how the game was played. Unfortunately, we’d taken it to the extreme, and it wasn’t working. Then Covid hit, and during its course, we had to throw everything overboard to move goods. We did that and brought our inventories down a good 30 percent. Since we weren’t making any drastic moves or taking on any extra debt, we were able to keep our folks employed.

We already had a plan to upgrade; now we’re walking the talk.

 

From that point, we adjusted our buys to have less excess. Our margins expanded several hundred basis points, and we cleared goods only end-season as it should be. We knew that better brands don’t want to sell to promotional stores and we wanted to sell better brands. As it stands right now, we have a few weeks of summer clearance on the floor. Come September, we’ll be selling fall goods at regular price until after Christmas.

So in a strange way, Covid was a gift to us. I don’t like using that analogy, but the pandemic really helped us reinforce our game plan and do what we’d intended to do: move more upscale. We already had the plan, but now we’re walking the talk…

What’s your current store count, and are you planning to enter new markets?
We have 247 full-line stores focused in Sun Belt locations. We’re in a lot of smaller markets that other upscale department stores have no designs on entering. Texas is our biggest market, followed by Florida. We just opened a store in South Dakota—our 30th state! We grew up in small markets where you had to know your customers. You couldn’t just depend on foot traffic: you had to build relationships. That circumstance has served us well.

We grew up in small markets where you had to know your customers.

 

Final question: What’s the hottest item/trend in menswear right now?
Color, texture, patterns! Tailored clothing for occasion dressing and, in some cases, for back-to-office. Linen in fresh new shades. Color is very important: our Southern customers don’t like neutrals; they don’t want to blend into the background. But let’s ask Jim Northrup, our menswear specialist.

Jim Northrup: What’s selling best in menswear? Whatever isn’t in his closet! He doesn’t need another knit polo or plain white dress shirt.