L Brands doesn’t plan mass closings

RETAIL

Many big-name retailers have closed stores en masse. Columbus-based L Brands is not averse to pruning, its leaders say, but no largescale closings are envisioned.

The company’s founder, chairman and CEO, Leslie H. Wexner, and his executive team emphasized that point several times at Thursday’s annual shareholders meeting and in comments on firstquarter results, which were released Wednesday.

“You see the headlines,” Wexner said. “Is it the end of retail with the Amazonization of everything? We take strong issue with that.

We’ve never been shy about closing stores. We watch our leases. We watch the performance of our stores very closely. We scrub our fleet continuously.”

Due to the tough retail market, L Brands has reduced its investment in stores this year to $850 million from $1 billion, but the company is hardly in a panic, said Chief Financial Officer Stuart Burgdoerfer.

“Our first guideline is: Is the store environment interesting and exciting?” Burgdoerfer said. “When we do that well, we have very strong brick-and-mortar performance. We open and close stores every year and have done so for years. We’re regularly maintaining the fleet.”

Wexner says the reason so many retailers are closing large numbers of stores has less to do with the stores or market conditions and more to do with something much simpler.

“My insight is: They’re just not selling good stuff,” he said.

“A lot of apparel retailers have been getting it wrong. Yes, there are different channels of selling. Yes, you have to have modern technology. But at the end of the day, you have either good or bad merchandise. In a very fundamental way, what drives the business is fidelity of the brand and fidelity of the merchandise.

“Fundamentally, the merchandise has to be good — and our merchandise is getting better and better.”

The retailer has been battling tough competition recently as various retailers have entered