When Stanley Marcus told Neiman’s story, he often began by saying that “Neiman Marcus was established as a result of the bad judgment of the founders.” That usually got the audience’s attention.
There were three founders: Stanley’s father, Herbert Marcus, Herbert’s sister, Carrie, and her husband Al. They abandoned their jobs in retail stores in Dallas and went to Atlanta to start a company that helped country merchants conduct big sales. It was a fabulous success.
Within two years they had not one, but two, buyout offers. One was for $25,000 in cash. The other was for the Missouri (or Kansas, Marcus wasn’t sure) franchise for a new product, Coca-Cola. Asa Candler was selling bottling franchises in 1900 for $1 each.
The partners probably knew that and decided to take the cash. But, if they bought the franchise, they would have made loads of money without the effort it took to create a world-class department store.
Neiman Marcus Rule Nr. 1: One bad decision isn’t the end.
On September 8, 1907, the trio opened Neiman Marcus in Dallas, with publicity touting “a new and exclusive place for fashionable women” to shop. Less than a month later, the “Banker’s Panic” of 1907 hit. It didn’t seem to matter. Neiman Marcus was off and running.
You wouldn’t have picked the partners to start a store for fashionable and upscale women. They were children of immigrants. None had graduated from high school. In the end, none of that mattered.
Neiman Marcus Rule Nr 2: Clear vision and hard work trump formal education.
Neiman Marcus lived by its values. One important one was Herbert Marcus’ clear statement of how they would do business: His credo was: “There is never a good sale for Neiman Marcus unless it’s a good buy for the customer.”
We’ll make that Neiman Marcus Rule Nr 3.
In the early 1950s, Stanley Marcus took over the company after his father and aunt died. The next fifty years were a time of showmanship, quality, and profit. He accented the high quality of the store’s goods by including the unique and extravagant items. Among them, according to the New York Times, were “his-and-hers Beechcraft planes, and scarves made of a supersoft fabric called shahtoosh, which came from the neck hairs of Himalayan goats.”
In a column in the Dallas Morning News in 1988, Stanley discussed what he learned from his father. Everything should be a good buy for the customer, and it was the store’s job to constantly improve quality.
Things have not been the same at Neiman Marcus since Stanley died in 2002. The company has had several owners. COVID-19 hit hard, and Neiman Marcus filed for bankruptcy. The vibrancy and quest for quality have given way to clever financing schemes.
Neiman Marcus Rule Nr. 4
Your past performance may have been impressive for decades. But there are no guarantees. You must create excellence anew every day.