Regaining control in fashion wholesale: What the Saks Global vendor crisis taught us

The recent merger of Saks Global and Neiman Marcus has sent shockwaves throughout the fashion wholesale industry, laying bare the vulnerabilities brands face when overly dependent on traditional retail giants.

With Saks extending payment terms to net-90 and some suppliers reportedly waiting until July 2026 for full payment, the crisis offers a sobering lesson in wholesale risk management.

Fashion wholesalers now find themselves in an impossible dilemma: maintain relationships with these retail powerhouses despite delayed payments, or walk away and sacrifice crucial market presence.

Beyond these immediate challenges, however, lies an opportunity to reassess and restructure wholesale operations for greater resilience.

The wholesale vulnerability triangle

Traditional department and retail store relationships have always tilted power in the retailer’s favour, but the Saks situation magnifies three critical vulnerabilities that require immediate attention:

1. Financial exposure: Extended payment terms trap significant capital in unpaid inventory, creating cash flow bottlenecks that can paralyse operations.
2. Inventory risk: When large volumes of stock sit in retailer warehouses without payment, brands lose both capital and control.
3. Market dependence: For many brands, major department stores and other retail locations represent irreplaceable market access and brand positioning.

These challenges demand a fresh approach to wholesale – one that balances retail partnerships with financial protection and operational control.

Three pillars for wholesale resilience

Facing these industry-wide challenges, fashion wholesalers must focus on strategically rebuilding their approach around three core principles that protect both retail relationships and finances.

1. Diversified sales channels to mitigate financial exposure

For CFOs managing financial risk, channel diversification isn’t just good practice, it’s essential protection against retail partner instability.

• Balanced DTC & wholesale mix: Brands like Vuori and Represent demonstrate the power of maintaining a strong direct-to-consumer presence alongside wholesale partners. A 70/30 or 60/40 split between DTC and wholesale creates financial stability when department store payments stall.
• Strategic wholesale partnerships: Rather than pursuing placement in every possible store, prioritise retailers with financial stability, transparent payment structures, and demonstrated commitment to supplier relationships.
• Marketplace expansion: Platforms like Farfetch, YNAP, and curated online boutiques can supplement traditional retail without the same payment vulnerabilities or inventory commitments.

2. Smarter inventory and cash flow management to address inventory risk

For merchandisers and planners, the shift from traditional presale to more dynamic inventory models has never been more critical.

• Flexible inventory models: Collaborative approaches, such as the one that Creation Gross uses, that rely on smaller, more frequent replenishment orders can dramatically reduce financial exposure while strengthening relationships with customers. Wholesalers can use this approach to protect cash flow, improve margins and maintain retail presence.
• Real-time demand planning: Advanced analytics and AI-driven forecasting tools, like Microsoft Copilot, can help brands better predict demand patterns and make more informed inventory allocation decisions.
• Tighter payment controls: Implementing robust credit control systems and clear payment milestones creates essential financial guardrails that prevent payment issues from becoming larger threats.

Short-term tactics for brands facing payment delays now

While long-term structural changes are indeed needed, brands currently caught in extended payment terms need immediate solutions that help in the here and now:

• Negotiate partial payments: Rather than accepting blanket net-90 terms, push for milestone payments at 30, 60, and 90 days to maintain cash flow.
• Revise future orders: Recalibrate upcoming seasonal deliveries based on current payment performance to limit additional exposure.
• Explore invoice financing: Short-term funding solutions can bridge the gap while maintaining critical retail relationships, though this comes at a cost to margins.
• Adjust pricing strategies: Factor extended payment terms into future wholesale pricing to reflect the true cost of capital tied up in delayed payments.

3. Supply chain agility & operational control to reduce market dependence

When payment terms extend to 90 days or beyond, supply chain flexibility becomes more than a nice-to-have, it becomes essential:

• Cash flow is critical: With capital locked in unpaid inventory for three months or longer, brands must be able to quickly redirect production capacity and existing stock toward channels that generate immediate revenue.
• Inventory becomes a strategic asset: Every piece in your warehouse represents tied-up capital that could be deployed elsewhere. Agile supply chains let you shift these assets to wherever they’ll generate the fastest returns.
• Market windows shrink dramatically: Fashion’s seasons move fast. The difference between 30-day and 90-day payments can mean an entire season has passed. Suppliers need the ability to pivot quickly as trends and demand signals shift.
• Risk compounds over time: With longer payment terms comes a greater risk of financial trouble or market disruption. Supply chain agility provides essential insurance against these growing uncertainties.

To address these challenges, brands need:

• End-to-end supply chain visibility: Complete tracking from production to final sale facilitates quicker responses to shifting retailer behaviours and market conditions.
• Inventory ringfencing: The ability to protect and redirect inventory between channels ensures that key markets and customers always receive priority, preserving revenue even when specific retail partners face challenges.
• Technology-enabled control: Implementing fashion-specific ERP systems provides the operational agility needed to navigate retail volatility while maintaining growth.

Merchandising strategies for the new wholesale reality

The often delicate and tenuous relationship between wholesalers and retailers can make life difficult for merchandisers. Traditional seasonal buying cycles alone are not enough.

Here are some best practices and tips to adapt:

• Stratify inventory by payment risk: Develop tiered inventory allocation strategies based on retailer payment reliability, reserving premium and high-margin items for channels with proven payment performance.
• Create retailer-specific assortments: Rather than offering identical collections across all wholesale partners, tailor assortments to match each retailer’s financial situation and sales velocity, limiting exposure to struggling partners.
• Implement just-in-time replenishment models: Work with retailers to establish frequent, data-driven replenishment cycles that reduce the need for large seasonal buys. This limits financial exposure while keeping retailers stocked.
• Build cross-channel inventory flexibility: Design merchandising programmes where products can move fluidly between wholesale, DTC and marketplace channels based on real-time performance data and payment patterns.

Planning strategies for the new wholesale reality

When payment terms stretch to 90 days and beyond, planning becomes essential to keeping businesses afloat. Spreadsheets and disconnected systems that many fashion wholesalers rely on are simply not sufficient.

Planners need comprehensive business planning solutions that allow them to turn potential crises, like new payment terms, into manageable challenges:

• Ditch the guesswork with real-time comparisons: Rather than waiting for month-end to discover payment delays, planners need systems that instantly compare actuals to plans across sales, purchases, and production. When payment terms shift, the ability to track real-time performance enables immediate corrective action.

• Customise planning to reflect payment realities: The one-size-fits-all approach to planning often fails in a fragmented wholesale environment. Planners now need to track revenue by payment risk category, manage quantities by retailer reliability, and tailor fields that directly address the specific patterns of different retail partners.

• Connect teams through unified planning workflows: When payment delays ripple through the business, scattered spreadsheets amplify confusion. Connecting sales forecasts to production schedules through linked plans ensures that when finance flags a retailer payment issue, the production and inventory teams can immediately adjust their plans in response.

• Build flexibility into every planning stage: With payment terms constantly in flux, proactive adjustment becomes essential. The ability to quickly shift production to meet immediate cash flow needs, fine-tune sales forecasts as payment patterns emerge, and aggregate business plans across various payment timelines ensures brands always remain one step ahead of liquidity challenges.

How Création Gross used technology to up its wholesale game

It’s important to remember that tech investments, like fashion ERPs, aren’t a cost but a strategic move to shore up businesses.

To help illustrate this, we’ll use the story of Création Gross, which faced significant challenges before implementing a dedicated fashion ERP.

As Tobias Schuhmacher, Head of IT and Organisation, explained: “Prior to adopting K3 Fashion, Création Gross faced complexity in its ERP environment due to the operation of a dual-mandate system which led to several inefficiencies… including inaccurate inventory levels, ordering processing issues, and financial discrepancies.”

The key lay in Création Gross’ decision to start collaborating more closely with its wholesale customers. It maintained conversations with customers to know how much stock they were selling, and how much additional goods they needed when it came to replenishment.

This approach to wholesale delivered substantial benefits that directly address today’s wholesale challenges:

For CFOs: Smaller, more frequent replenishment orders can reduce capital tied up in unpaid inventory while improving cash flow predictability. Rather than waiting months for payment on large seasonal shipments, brands can protect financial resources by only delivering exactly what customers need.

For merchandisers: Comprehensive management of backlog on future production allows supply chain teams to align new production with existing orders. This helps guarantee stock for customers with precise delivery dates, increasing both customer satisfaction and repeat business.

For planners: By better understanding customer needs, planners can move from reactive to proactive while shifting from traditional wholesale models to more agile, data-driven, customer-oriented approaches.

Finding balance for brands heavily dependent on department stores

While the tips, recommendations and solutions offered so far are the ideal endpoint for brands, the reality is that not all brands can immediately pivot away from department store and retail dependence.

In this scenario, a more gradual approach makes more sense:

• Start with direct digital presence: Even without a full DTC infrastructure, establishing direct customer connections through digital channels provides valuable market intelligence and reduces information asymmetry.
• Test alternative channels at small scale: Pilot programmes with select marketplaces or boutique retailers can create proof points for diversification without risking core relationships.
• Build strategic partnerships: Develop deeper relationships with more financially stable department or retail stores while gradually reducing dependency on those with challenging payment terms.

Regaining wholesale control

Even if a major wholesale partner like Saks Global threatens to terminate relationships when payment issues arise, the right systems provide the control needed to maintain these partnerships without accepting unmanageable risk.

When paired with a collaborative, customer-oriented approach like Création Gross’, technology enables brands to continue distributing goods while using accurate sales data to minimise capital exposure.

As Création Gross discovered, this data-driven approach minimised risk on both sides of the equation, allowing brands to make decisions based on actual performance.

“Ultimately, this modern approach to wholesale – treating it with the same care and attention to detail as retail – has not only streamlined our operations but positively impacted our bottom line,” added Tobias.

Key takeaways

The Saks Global vendor payment crisis highlights that traditional wholesale models are increasingly unsustainable and fragile.

It also serves as a reminder that every fashion brand stakeholder has a role to play in building resilience:

For CFOs: Prioritise channel diversification and financial flexibility. The most resilient brands maintain multiple revenue streams. Ideally, no single wholesale partner should represent more than 15-20% of total business.

For merchandisers: Move beyond seasonal assortments to create dynamic, retailer-specific inventory strategies that reflect each partner’s financial reality and sales performance.

For planners: Turn planning from a periodic exercise to a continuous, data-driven process that can respond quickly to changing market conditions and payment performance.

By embracing smarter channel strategies, implementing data-driven inventory management, and leveraging fashion-specific technology capabilities, wholesalers can mitigate points of vulnerability in their retail partnerships and flourish, even in the face of retail consolidation and payment challenges.

Fashion ERPs offer more than just systems – they provide the strategic control needed to maintain critical retail relationships while safeguarding finances and operational stability.

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