Dive Brief:

• Neiman Marcus Group on Wednesday "began a reorganization of our Neiman Marcus and Bergdorf Goodman store associate structure," and plans layoffs of "selling and non-selling associates," a company spokesperson confirmed on Thursday. The spokesperson declined to say how many people or which locations are affected.

• The changes are "substantial," according to Women's Wear Daily, which first reported the news after obtaining a letter from CEO Geoffroy van Raemdonck to vendors. Some involve restaurant workers who may be hired back eventually, according to WWD's report.

• However, the department store retailer is posting new jobs related to e-commerce. "We are also rolling out new positions, including service ambassadors, digital client advisors, and personal stylists, to better serve our customers at Neiman Marcus," the spokesperson said in an email.

Dive Insight:

The support that Neiman Marcus Group has received from creditors as a bankruptcy court last month approved its exit plan suggests they see hope in the company's long term survival.

"Neiman Marcus Group is now in a much stronger financial position than we were prior to our Chapter 11 restructuring," the spokesperson said Thursday. "NMG will emerge with substantially reduced debt, one of the best capital structures among multi-retailers, and enhanced financial flexibility. We are evaluating every part of our business to ensure that the company is positioned for long-term success."

Its future appears predicated on success online, more than the venerable brick-and-mortar department stores, both Neiman Marcus and Bergdorf Goodman, that represent its legacy. Work on that pivot began well before either the company's bankruptcy filing or the pandemic, led by Neiman Marcus Chief Innovation Officer Katie Mullen, who arrived two years ago.

Even as lawyers and executives hashed out the company's plans in bankruptcy court in recent months, the company unveiled a virtual hub offering "luxury services and experiences" and replaced its Fall book with a digital campaign. The foray into luxury e-commerce hasn't all been smooth, however, as seen in the years-long agitation around the MyTheresa luxury site, seen by many as the company's "crown jewel," which continued through this summer.

If the layoffs are indeed as significant as indicated in the WWD account, they threaten to further erode the department store landscape. Neiman itself closed down its Hudson Yards location in New York after just over a year, along with several in other states. Lord & Taylor, in its own bankruptcy, recently permanently shut down all its stores, after selling off its Manhattan flagship over a year ago, and Macy's is in the midst of closing 125 stores over the next three years.

"These are difficult decisions we must make at this time and we are so grateful for our dedicated store associates," the spokesperson said of the Neiman Marcus and Bergdorf layoffs.