December 22, 2012 in Business

Retailers make final push

As shopping winds down, last days are busiest
Associated Press
 
Associated Press photo

L.L. Bean employees work in the company’s order fulfillment center Thursday in Freeport, Maine.
(Full-size photo)

FREEPORT, Maine – With the final retail push under way, L.L. Bean CEO Chris McCormick is playing Santa’s helper against a backdrop of conveyor belts and beeping front-end loaders as he boxes up slippers and shirts.

But there’s little time to reflect on the holiday cheer those gifts will bring because he’s busy concentrating to make sure no shipments go astray.

At L.L. Bean, top executives are abandoning their desks to work in the shipping department and answer phones as part of an annual all-hands-on-deck approach to ensure last-minute purchases arrive at their destinations before Christmas.

This season, the deadline for orders with guaranteed Christmas delivery is the latest ever, with L.L. Bean offering free shipping as late as noon Friday.

“Consumers are going to buy when they want to buy. There’s no changing that, so we have to be ready,” McCormick, his sleeves rolled up, said during a break inside the 1-million-square-foot distribution center where nearly 200,000 orders are shipped daily in late December.

Thanks to improved shipping logistics, many online and catalog retailers established Christmas delivery deadlines on Thursday and Friday, with some like Amazon extending the deadline for one-day shipping until today.

And shoppers can expect the trend to continue.

Following Amazon’s lead, other retailers are experimenting with regional warehouses to get the product closer to potential customers, said Raj Kumar, a retail partner at A.T. Kearney, a global management consulting firm.

Macy’s, Toys R Us and Wal-Mart are testing pilot programs in which stores themselves are utilized as shipping hubs, he said.

Unlike Amazon, L.L. Bean’s worldwide shipping hub is centralized, about a mile from the corporate headquarters.

The company hired 4,700 seasonal workers to help with the holiday rush, doubling the workforce, and 500 administrative employees are expected to get into the act during crunch times.

In the past, McCormick worked on a product-sorting conveyor line, in the retail store stockroom, and in a recycling area, breaking down empty cardboard boxes. The worst job of all, he said, was one stint working in the call center dealing with angry and frustrated customers.

“It’s hard because you’ve disappointed people and you don’t want to disappoint anybody, especially at this time of the year,” McCormick said. “I wouldn’t want their job.”

Like most retailers, L.L. Bean makes half of its annual sales in the last two months of the year. And retailers are more than happy to oblige late shoppers, especially since holiday sales haven’t been especially strong going into the final shopping weekend before Christmas, according to Michael McNamara, vice president for research and analysis at MasterCard Advisors’ SpendingPulse.

Nationwide, the final retail push Friday and today is expected to yield $34 billion in total sales, accounting for roughly 8 percent of the $400 billion in December sales, McNamara said.

© Copyright 2012 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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