Economy Favors Of Upscale Retailers As ‘The Rich Are Getting Richer’ This Year

She already has one mink coat, but that didn’t deter Joyce Kim from shopping for another.

“I need a full-length one,” said the New Yorker as she perused the offerings at Saks Fifth Avenue, eying a $12,000 long black coat. “My Christmas gift to me.”

‘Tis the season for upscale retailers who attract big spenders during the holidays. Not since the ostentatious 1980s has high-end merchandise been in such demand, thanks to a healthy economy and a booming stock market.

Saks is selling out of cashmere. Shoppers scout out diamonds at Tiffany & Co. and handbags at Gucci. Anything from Chanel, Prada or Louis Vuitton is being bought up.

“The rich are getting richer,” said Jeffrey Feiner, a retail analyst at Salomon Brothers Inc. “There’s been a creation of wealth that’s owned by people who shop in these kind of stores.”

It’s been a number of years since there has been such excitement for high-end merchandise. A decade ago, consumers fawned over designer products and were willing to spend big bucks to possess such brands.

But demand for designer names soon waned as consumers became more cautious in their spending after the stock market tumbled in 1987.

Consumers, however, say they’re willing to spend again this year, encouraged by low interest rates, high employment levels and a six-year winning streak on Wall Street. And early results from the first weeks of the Christmas season show plenty of buying of luxury goods.

That’s a boon to upscale retailers, who thrive during healthy economic times and have already enjoyed one of their best years to date.

Tiffany saw its earnings jump 65 percent in the first nine months of the year and Saks significantly narrowed its loss from 1995. Gucci NV’s stock has gone from $22 at its initial public offering in October 1995 to around $70.

“Not only is the upscale shopper encouraged by the stock market, which has buoyed his wealth, but also by the products that they offer, which have color and excitement,” said analyst Walter Loeb of Loeb Associates in New York.

Holiday catalogs were all gone from Tiffany’s Fifth Avenue store, which was packed with shoppers scanning store displays. Ladies were grabbing up $100 sweater sets at Henri Bendel like they had nothing to wear in their closets.

Neiman Marcus can’t keep Barry Kieselstein-Cord Y-necklaces in stock, despite the hefty price tag that runs between $750 to $1,250 depending on design.

“They’re currently on re-order they’ve been so popular,” said Jodie Corley, a Neiman spokeswoman.

Joan Stein checked out a $3,000 Judith Leiber beaded evening bag at Saks, a perfect compliment to her black New Year’s Eve gown.

“I love it,” she said. “I’ve waited so long to buy this, I think the time has finally come.”