Arrow-right Camera
The Spokesman-Review Newspaper

The Spokesman-Review Newspaper The Spokesman-Review

Spokane, Washington  Est. May 19, 1883
Clear Night 61° Clear
News >  Business

LL Bean: No bonus after tough year, more jobs to be cut

A pair of boots at the L.L. Bean manufacturing center in Lewiston, Maine, on Aug. 17, 2017. (Associated Press)
A pair of boots at the L.L. Bean manufacturing center in Lewiston, Maine, on Aug. 17, 2017. (Associated Press)
By David Sharp Associated Press

FREEPORT, Maine – L.L. Bean’s sales dipped slightly over the past year, forcing the elimination of worker bonuses for the first time since 2008, but the CEO told workers on Friday that changes adopted in recent months are putting the company on a “path to a more prosperous future.”

The Maine-based outdoors retailer announced annual revenue of $1.6 billion, which was nearly flat, for its fiscal year that ended Feb. 25.

CEO Steve Smith said nearly 500 workers took advantage of a voluntary early-retirement program and that another 100 jobs will be eliminated early next month. There will be a net loss of 400 jobs after some jobs are refilled. L.L. Bean employees 6,000 people.

The workforce reduction, a tightening of the company’s returns and shipping policies, and pension changes are part of cost-cutting efforts.

“The work we accomplished this year will create new opportunities for growth and improved performance for many years to come,” Smith told workers in a memo.

L.L. Bean is coming off two years of flat sales. But the company continues to invest in the future, opening six stores in the past year, bringing the total number of stores outside Maine to 35, and there are plans to open five more stores in the coming year, Smith said.

It has been a year of big changes.

L.L. Bean announced it was changing its pensions and reducing its workforce, and sharpened its outdoor focus with a “Be an Outsider” campaign.

It shocked some shoppers by changing its “satisfaction” guarantee, something long considered sacrosanct, by imposing a one-year limit on returns of most items. It also eliminated free shipping on all products, imposing a $50 minimum.

Smith said adjustments to returns and shipping policies collectively represented one of the “largest and most critical” changes in the 106-year-old company’s history.

“The rollout went extremely well, from marketing, communications and operations perspectives, and customer and public sentiment continues to be mostly positive,” he wrote.

Retail analyst Walter Loeb said it has been a tough period for retailers, and that most are responding like Bean, by cutting costs and refocusing on their core customers.

“The trend is to be leaner, to be very aggressive in cutting back, so that you can be profitable with the customers that you maintain,” he said.

The Spokesman-Review Newspaper

Local journalism is essential.

Give directly to The Spokesman-Review's Northwest Passages community forums series -- which helps to offset the costs of several reporter and editor positions at the newspaper -- by using the easy options below. Gifts processed in this system are not tax deductible, but are predominately used to help meet the local financial requirements needed to receive national matching-grant funds.

Active Person

Subscribe to the Coronavirus newsletter

Get the day’s latest Coronavirus news delivered to your inbox by subscribing to our newsletter.