L L Bean: Corporate Strategy
L.L. Bean: Past Success
For many years, L.L. Bean has proven itself as an increasingly successful company relative to its core competitors within its outdoor clothing and recreation equipment industry. The success has driven the company to its current position as the “largest mail order company in the specialty outdoor business.” Leon Leonwood Bean drove his company towards success and maintained this status through innovation and his progressive attitude within his community.
Throughout its history, various critical factors have contributed to the success of L.L. Bean. Leon Leonwood Bean created a strong corporate foundation which has been ...view middle of the document...
Therefore, strong employee morale has had an immense impact on the financial profitability and overall positive image created and maintained by the company.
At present, L.L. Bean is experiencing alternate opportunities to achieve financial growth. From 1975 to 1980, the company’s business quadrupled. If management can capitalize on these present opportunities, continued growth can be achieved. Internal challenges exist that can potentially limit the success of L.L. Bean’s promising future. It is crucial that each option chosen and problem solved does not compromise the company’s “customer first” legacy. In addition, there is future uncertainty within the company that must be resolved to ensure the security of investors, reputation, and the ultimate longevity of the company. For the next 10 to 15 years, uncertainty regarding future ownership will become an issue. Because there is no L.L. Bean family member available to participate, the company must consider the interest from “suiters” in buying out the company.
Avenues for Growth: Recommendations
Option #1: Mail-Order Option
As the company’s specialty and largest source of income, L.L. Bean has acquired extensive knowledge in the mail-order distribution channel. These changes will require relatively less capital and enhance an already successful business model. If the company has already reached its limit on growth from mail order advertising and distribution, these options may yield less than optimal progress for the company. Because of this, it may be more advantageous to target potential customers from other advertising or distribution avenues (e.g. retail sales option)
Option #2: Retail Sales Option
If past trends predict future success, then increasing retail store flooring space is encouraged. It is understood that store sales (i.e. in the past) have increased following an increase in flooring space.
In regards to opening up new retail stores, the increasing demand and interest in expansion (department, specialty, mall, and retail distribution) increases L.L. Bean’s options and enables them to choose the option that best benefits the company. Finally, by opening new stores, an opportunity is available to reach customers who prefer interaction with the offerings they purchase. Expanding the number of retail stores and becoming successful will require strategic management...