In mid-2003, CEO Chris McCormick felt LL Bean was in a good position to start growing again. For nearly 90 years, the company has sold clothing and equipment for outdoor enthusiasts through their catalogs and one retail store in Freeport, Maine. In the three decades prior to 1996, the average sales growth of about 20% per year. In 1995, sales reached $ 1 billion, but the stagnation in the next six years - an increase of less than 2% per year. The company responded to the structural reorganization and investment in the Internet sales channel. In 2002 and early 2003, McCormick has led efforts to reduce overhead costs and improve its internal systems, including the elimination of 1,000 jobs - which reduced the year-round staff of almost 15%. Following these initiatives, the company remained profitable and enjoyed strong balance sheet, but sales growth remains close to zero. Most importantly, in the period between 2000 and 2002, LL Bean opened three retail stores in shopping centers outside the state of Maine. McCormick examine these three stores as the first of the chain of stores that would generate new sales channel and allow the LL Bean grow. The first results of three new stores were below expectations; LL Bean has spent considerable time studying their activities in retail stores in an attempt to find out where it could be improved. Since the company began applying these lessons in the stores, the performance picked up, fueling optimism McCormick that LL Bean could rise to retail stores. "Hide
by Rajiv Lal, Walter J. Salmon, James Weber Source: Harvard Business School 20 pages. Publication Date: March 31, 2004. Prod. #: 504080-PDF-ENG
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