L.L. Bean keeps values in sight

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BOSTON - Making its values an integral part of its business is a goal that L.L. Bean has striven to maintain and is one reason for its success, chairman Leon Gorman told a room full of catalogers during his keynote speech here this week at the Annual Conference for Catalog and Multichannel Merchants.

Mr. Gorman retired as president of L.L. Bean in 2001 after more than 40 years with the company. Recently he released a book that describes his experiences there: "L.L. Bean: The Making of an American Icon."

"I've always seen our values as a touchstone to come back to when we get lost," Mr. Gorman said. It was an important lesson to learn as the company doubled in size nine times during his tenure.

Many of the company's values come from its founder and Mr. Gorman's grandfather, Leon Leonwood Bean, whose golden rule was to "sell good merchandise at a reasonable profit, treat your customers like human beings and they'll always come back for more."

Mr. Bean founded its catalog in 1912 with a three-page sell sheet for a leather-topped hunting boot that he had developed. Even though 90 of the first 100 pairs were returned because of a defect, he persevered, corrected the problem and continued to market the boots through the mail.

The company entered its first period of high growth in the late 1960s after Mr. Gorman had replaced over 90 percent of the product line with the latest advances in outdoor apparel.

Then he reinstated the company's 100-percent-price-back guarantee that had been discontinued in previous years.

"We doubled our return rate but our reputation soared," he said.

As the company continued to grow, the question arose whether success would spoil the company. But Mr. Gorman was always trying to make sure that didn't happen. During the '70s, for example, he put together a highly competent management team and required that each member have a serious interest in the outdoors. He even employed an industrial psychologist to make sure the team fit in.

The focus on the customer has always been there. In the '80s Mr. Gorman instituted a program for continuous improvement in customer service based on something he had heard at a catalog conference.

The company put together a list of competitors and criteria for measurement, such as guarantee, customer service and whether products were in stock. Then it would have employees call and place orders with each competitor numerous times throughout the year. Where L.L. Bean compared favorably, great; where it didn't, that would be the company's goal for improvement the following year.

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