L.L. Bean reported sales reached $1.6 billion in 2018, a 1 percent gain over 2017. Based on those results, the company’s directors approved a 5 percent annual pay bonus to about 5,400 year-round employees and an additional 2 percent enhancement to their 401(k) contributions.
In its statement, L.L. Bean said the “solid company performance comes at a time when the retail industry continues to experience challenges and follows a year in which considerable changes were made at the company.” In 2018 the company completed the upgrade of internal legacy technology and warehouse systems which resulted in record-setting daily orders processed, the highest on-time delivery and the lowest customer product backlogs in decades. Additionally, changes to the return policy cut fraudulent and abusive returns. L.L.Bean also continued to grow its Be an Outsider marketing campaign that has attracted a notable increase in new buyers.
“Measured against corporate goals and expectations, we performed well in a very competitive industry and a very difficult retail economy,” said Steve Smith, L.L.Bean president and CEO. “We are on a journey toward growing our top line and the improvement to our bottom line is a critical first step. Improved profitability allows us to invest in our business. Today we thank and appreciate the hard work and dedication of our employees, the loyalty of our customers and the quality of our products and services.”
The company said it made significant investments in employee benefits. Improvements in core profitability enabled the company to invest nearly $45 million in employee benefits in 2018 including the discretionary cash bonus, 401(k) contributions and enhancements, expanded paid time off, paid parental leave and elder care support, and a holiday gift.
“The year-end bonus and the enhanced contribution to the 401(k) underscores the ownership’s commitment to sharing the company’s profits and financial success with those who create them, our employees,” said Shawn Gorman, L.L.Bean’s executive chairman of the board, and great-grandson of founder Leon Leonwood Bean. “Our employees are who we are. The board of directors and the family are pleased that their efforts and excellence make it possible to reward them with a year-end bonus.”
The retailer had suspended its employee annual bonus last March because of flat revenues in 2017, the only time in 10 years it did not grant a bonus. Those disappointing revenues led to L.L. Bean trimming its workforce by 100 positions and revising its long-standing, lifetime-guarantee return policy to stem abuses. The company also experienced shipping problems in 2017 related to a software upgrade.
Two years ago, L.L. Bean handed out 3 percent bonuses to about 6,000 eligible employees.
L.L. Bean has 48 stores in 18 U.S. states and 28 stores in Japan.
Image courtesy L.L. Bean