L. L. Bean CEO Talks Importance of Summer, U. S. Market and Tote Bags
The retailer's fiscal 2023 sales were $1.7 million, a slight decline compared to $1.8 million for the previous fiscal year.
As a true heritage brand with a commitment to outdoor adventures and creating quality products, L.L. Bean isn't riding on its reputation in favor of exploring new markets and collaborations.
Tuesday's launch of a collaboration with Summersalt, a UV-protected swimwear brand that offers inclusive sizing, is its latest exercise in sales opportunities. During a preview in New York last week, the company's chief executive officer and president Stephen Smith spoke of the tie-in and discussed new ventures. Playing into apparel, gear and regions of the country where warmer weather activities are done is one of the ways that the company aims to build sales and deal with changing weather patterns.
Founded in 1912 and known for its coldweather styles — including its signature “duck” boots, classic rag wool sweaters and flannel shirts — L.L. Bean stands by its production with a yearlong return policy, barring some special conditions. While spring-summer is a good business for the omnichannel company, L.L.
Bean considers it to be “a huge growth opportunity,” as more people are engaging in outdoor activities in the warmer months, Smith said. The Freeport, Mainebased brand is opening stores further south in the country, and it recognizes that many customers are gravitating to southern states. “So we need to get better with our warm-weather products,” he said. “Working with Summersalt is a perfect extension to learn from them. They are masters with their fit and fabric. And their audience is different from ours, so we both can grow and widen our audiences.”
Part of the interest in summery sports and warmer-weather activities is “for sure,” driven by recent unseasonably warm winters in the Northeast and in some cases limited snowfall, Smith said. “The weather is getting warmer throughout the country. The population is moving further south. We are a New England-centric business, so we have so much potential, as we move west and south with great awareness and consideration. But we need more of a physical presence and more products.”
For its 2023 fiscal year, L.L. Bean's annual revenue of $1.7 billion fell short of its budget goals and sales decreased slightly compared to the previous year's $1.8 billion mark. Announcing those results last month, the company said it had “ensured steady inventory and timely fulfillment,” while navigating supply chain challenges. Outerwear, sweaters and denim were categories that contributed year-over-year growth.
During fiscal-year 2023, L.L. Bean bolstered its omnichannel strategy and unveiled four stores in the U.S. and
Canada — including its first in Quebec in partnership with Jaytex Group. There are 58 stores nationwide, 25 stores in
Japan and 13 stores in Canada, where a French-language e-commerce site was introduced for Canadian customers as well as integrated in-store and e-commerce product distribution options.
L.L. Bean plans to unveil four more stores primarily in the mid-Atlantic region, but is keeping the lid on those precise locations for the time being. Every store that L.L. Bean opens “hits its numbers immediately,” according to Smith.
The company has lined up a couple of additional stores that are scheduled to open in 2025, the locations of which he declined to name. L.L. Bean also has a wholesale business through such major chains as Dillard's and Academy Sports, as well as multiple independent specialty retailers in Tennessee, Virginia, North Carolina and South Carolina, as well as other regions of the Southeast.
L.L. Bean also has distribution in Japan, where it has a partnership with the Tokyobased Itochu Group for the distribution of its apparel and footwear in Japan. There are stores, a catalogue, and a 250-person corporate office. L.L. Bean also gleans ideas and trends from the market in
Japan, which rejuvenated sales of its tote bags 10 or 15 years ago, and kick-started the continued interest among younger and social media-friendly shoppers. This fall or next spring some of the Japanese styles that are redesigns of styles from L.L. Bean's archives will be introduced to the U.S. market.
As for the frenzy over the seemingly
L.L. Bean-inspired mini totes that Trader Joe's went viral with last month, Smith said, “Imitation is the sincerest form of flattery. Look, if people are into buying bags, and buying sustainable bags, they should buy ours. Our business is fantastic, and their business is great. We've had an incredible ride in 2023 and 2024 — there's no slowing down.”
Back in its home state, L.L. Bean unveiled a $110 million corporate campus last year. The 390,000-square-foot headquarters has all-glass meeting rooms with sweeping views of the open land and public trails on its property. Employees can also brainstorm in a 10,000-squarefoot courtyard around a fire pit or in tree houses or huddle rooms. The 950 Maine-based staffers can also burn off any work tension in a state-of-the-art fitness center and then hit The Beanery, the company's cafeteria. “We always said that the new office would be a magnet and not a mandate. That was the strategy that we used,” Smith said.
Although the company remains fully hybrid and each department can determine its own decisions and rules, office occupancy is nearly 75 percent on Tuesdays, Wednesdays and Thursdays. Smith said there has been “no drop off” in productivity and there has never been a point where he has felt, “Wow, we need to get everybody back in the office, because something isn't working.”
The flexibility has been helpful in recruiting talent post-pandemic, especially those with young families, who might want to be home for the morning school bus pickup or the afternoon drop-off. “And we're in Maine. People come to Maine for lots of reasons other than a paycheck. People appreciate that flexibility, including being able to work at home, if your child care isn't working on a certain day,” said Smith, who has led the company since 2016.
To support its sustainability efforts, the buildings are run on 80 percent renewable electricity that is powered by solar installations in the company's home state of Maine. There are also outdoor air systems with energy recovery wheels designed to get 60 percent of the energy from the exhaust air systems.
In light of the company generating its third highest annual revenues, L.L. Bean's board recently approved a performance bonus of 9 percent of annual pay for its approximately 5,600 employees, consisting of a 5 percent cash bonus and a 4 percent 401(k) contribution.
For Mental Health Awareness Month in May, L.L. Bean will be taking a monthlong break from social media to prioritize time outdoors and to challenge followers to do the same. The brand will clear its Instagram grid, pause posting across all of its social media channels, and host a user challenge with the NatureDose app to help people track their time outside.
L.L. Bean is 18 months into what will be at least a three-year $50 million project to remodel its Freeport flagship and to reimagine its retail campus. More interactive features will be added as well as kids' activities and water ones like an amped-up pond and aquarium. L.L. Bean is also sprucing up and expanding its “Discovery Park” with more greenery and community events like morning yoga in the summer and concerts in the evening. Engaging the community has been engrained in the company's ethos for a while, according to Smith.
That is largely due to the corporate culture and stakeholder philosophy that was put in place by Leon Gorman, a grandson of the company's founder, who ran the company from 1967 to 2002. The thinking is that L.L. Bean supports six stakeholders: shareholders, employees, customers, suppliers, the community and the environment. “We make sure that as a business, any decision that we make doesn't negatively impact one stakeholder for the benefit of another,” Smith said. “That's a really active thought in our executive team's decisions. We make sure that we have a strong entity in the middle to support all of those entities. The community and the environment are two of those top stakeholders so everything that we do — whether it's in Freeport, the state of Maine or around all of our regional stores — is really in our ethos to be supporting those communities. It's part of how we do business. The same is true of the environment.
In February, L.L. Bean teamed up with a few Maine ski resorts to offer free lift tickets and rentals to encourage others to get outdoors. The company also offers free outdoor yoga classes and movie nights as part of its Summer in the Park series.
Summersalt cofounder Reshma Chattaram Chamberlin contacted Smith directly about a potential collaboration. Cofounder Lori Coulter said this is its largest one thus far, with others having been with Diane von Furstenberg, Markarian and Rifle Paper Co. The latter generated $1 million in swimwear sales in one day, Coulter said.
The L.L. Bean-Summersalt assortment will be offered on both companies' sites and in stores. It also has allowed the swimwear specialist to delve into lifestyle beach-friendly pieces, which is a segment that it plans to cross over into more. Approaching its seventh year in business, the brand's mission is to inspire childlike joy at the beach, by offering a range of sizes and style options to ease any type of body issues some might have to enjoy life and have more adventures — big and small. The company has sold more than 3.6 million units.
Along with swimwear, there are towels, co-branded totes, beach chairs, dresses, cover-ups, a paddle board, accessories and gender-neutral swim shirts. Retail prices on swimwear range from $65 for shorts or swim skirts to $95 for onepiece swimsuits.