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December 20, 2004

A seasonal problem | L.L. Bean call center woes stem from need for trained seasonal workers

By Taylor Smith
For weeks, L.L. Bean has made headlines in Maine newspapers ˆ— not for its holiday sales numbers (although those have been strong) or any new products it's introduced for the crucial holiday season, but for its recent decision to abandon plans to build a 50,000-square-foot call center in Oakland's First Park.

The company dropped its plan for the new facility, which would have replaced an existing call center in downtown Waterville, following Gov. John Baldacci's Nov. 19 announcement that Bellevue, Wash.-based cellular phone company T-Mobile USA had chosen Maine ˆ— and FirstPark specifically ˆ— to host its new $17 million customer service contact center.

The decision, according to L.L. Bean spokesperson Rich Donaldson, stemmed from the uncertainty that the Waterville area labor market could support both call centers. "Our business decision is based on a new dynamic that's been introduced to that labor market," says Donaldson. "The [T-Mobile deal] is good news for the state of Maine, but this is requiring a fair amount of additional work on our part."

In addition to complicating L.L. Bean's plans for a new FirstPark call center, the T-Mobile announcement also throws into turmoil L.L. Bean's overall call center strategy. The company's planned development in Waterville was part of a three-pronged call center model the firm has been developing since 1997, when it opened a seasonal facility in Waterville after capacity was stretched thin at the company's other call centers in Portland and Lewiston. (The Waterville facility went year-round in 1999.) The concept, according to Donaldson, was to have three call centers of similar size and scale that each could be operated during off-peak seasons with a relatively small number of year-round employees, but which also had the flexibility to handle hundreds of additional seasonal employees.

One of the keys to that model was keeping the number of returning seasonal workers high in order to reduce the amount of costly and time-consuming training needed each fall for new seasonal employees. The question for L.L. Bean, according to Donaldson, is how many of its seasonal workers in the Waterville area will jump ship for jobs at T-Mobile. "Is that three call center model still the right thing to do based on those economies of scale, or is it just as viable to go with more numerous but smaller call centers?" says Donaldson. "We're going to take inventory of the options and see which ones are the most viable. We're just being open to changing that mindset."

To figure that out, L.L. Bean is working with state officials and an outside consultant to examine the labor situation in the Waterville area as well as to explore options in other areas of the state. (During the past few weeks, L.L. Bean has fielded numerous offers from officials across the state to locate a call center in their towns.)

In Kennebec County, local officials are bullish on the Waterville area's labor resources. John Butera, executive director of the Central Maine Growth Council in Fairfield, believes there are enough people in the Waterville area to support a wide variety of industries. What's more, he says the discussion of the Waterville area is somewhat limiting, noting that the available workforce stretches beyond the 14 towns designated as the Waterville labor market by the state Department of Labor. "We all know that people drive many miles in Maine for a quality job," he says.

Stretched thin
Still, T-Mobile's projected full-time workforce of 700 presented problems for L.L. Bean, which in recent years has struggled to meet increasing seasonal workforce demands. In addition to the 220 year-round employees in Waterville, Bean this year hired 800 seasonal employees ˆ— 300 more than last year ˆ— to answer phones during the peak holiday season. What's more, the company in November opened a temporary call center in Oxford that will employ 300 until late December. "This year, we've already gone into a new market, which speaks to the fact that we've had some difficulty fulfilling our seasonal needs," says Donaldson. "With 800 in Waterville this year and 300 in Oxford, we already feel like we're being stretched a bit on those terms. And with 700 year-round employees [for T-Mobile], it does have us looking at other options."

After getting wind of L.L. Bean's decision to scrap its FirstPark plans, Baldacci, Maine Department of Labor Commissioner Laura Fortman and Jeff Sosnaud, deputy commissioner of the Department of Economic and Community Development, met with L.L. Bean CEO Chris McCormick and other company officials in early December, pledging state resources to help Bean evaluate the labor force in the Waterville area. During the meeting, L.L. Bean remained firm that its Oakland call center plans were off the table, but did say it would maintain its year-round and seasonal workforces in the Waterville area. "L.L. Bean is growing, and it will be growing in Maine," says Fortman. "I think that's good news. Our job is to work cooperatively with them to provide whatever information they want."

In broad terms, Fortman says there is an adequate workforce to fit L.L. Bean's seasonal employment needs, though she admits that she needs to sit down with L.L. Bean staffers to "drill down on those numbers." But while Fortman's arguments for the Waterville area are based on a number of tantalizing criteria ˆ— including the number of college students and senior citizens ˆ— one segment of the population might not have a very large impact on L.L. Bean's decision: the unemployed.

The unemployment rate in the Waterville-Augusta area, which at 5.4% in October was 0.8 percentage points higher than the state average, was cited by Fortman as one of the statistics that might show the region as having a willing workforce. But while Donaldson doesn't say that unemployed or underemployed people are poor candidates for the job, he admits the demographic isn't ideal since such workers are likely to be looking for full-time opportunities rather than depending on the stop-gap solution of seasonal employment.

As a result, such workers aren't likely to return to seasonal positions year after year. "In the risk assessment, it makes sense to make sure that the share of seasonal workers that are in that underemployed or between-jobs category isn't disproportionate," he says. "We're all working towards making Maine a better place in terms of employment, but you want to make sure you don't leave yourself open to the risk of being understaffed."

Donaldson expects that in the next two months L.L. Bean will have enough information from its own seasonal hiring experience, plus input from its consultant and the state, to make an informed decision about what its next step will be.

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