L.L.Bean freezes wages
Freeport retailer L.L.Bean will freeze employee wages and salaries for fiscal year 2009 as part of wider cost-cutting efforts that are expected to include layoffs.
In a Jan. 20 memo to employees obtained by Mainebiz, CEO Chris McCormick said the freeze would prevent the elimination of 75 to 100 jobs. Still, layoffs will be unavoidable, even with voluntary retirement efforts scheduled to begin next month, he said. Employees are unlikely to receive year-end bonuses, though the board will decide officially at its March meeting after the close of the fiscal year in February, company spokeswoman Carolyn Beem told Mainebiz.
Weak sales in 2008, which fell below 2007 levels, have led to the largest budget challenge in L.L.Bean's history, McCormick said in the memo. December sales fell about 10% below projections and a hoped-for late surge in demand never materialized. However, year-to-date gross margins are on budget and inventories are in good shape, he wrote. McCormick also highlighted the safest peak season in the company's history and a recent national survey that ranked the company first in the industry for customer service.
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