Lands’ End Works to Rev Up Corporate Sales

Lands’ End’s second-quarter earnings show that the company’s business-to-business division suffered what a corporate release called a “single-digit decline.” Given the slowdown in spending nationwide, the decline isn’t all that surprising. But revenue from Lands’ End’s Corporate Sales book had been growing at an 18% annual compounded rate since its beginning in 1993. Then, too, the $160 million b-to-b unit, which specializes in selling logoed golf shirts and other apparel to large corporations, increased its circulation 18% this year. And Dodgeville, WI-based Lands’ End is about to open a second distribution center for the division in October — a 215,000-sq.-ft.-building in Stevens Point, WI — bringing Corporate Sales’ fulfillment capacity up to 360,000 sq. ft.

Hilary Kleese, marketing manager for Lands’ End Corporate Sales, says that the poor economy has led companies to cut some corporate events, such as golf outings. As a result, there’s been decreased demand for logoed golf shirts, which are Lands’ End Corporate Sales’ biggest sellers. And the unit’s average order size has decreased, though Kleese won’t reveal by how much. (Last year, the average order size was roughly $340 — four times greater than that of Lands’ End’s consumer division.) “Where companies might have bought $35 polo shirts in the past,” Kleese says, “they’re going for our lower-priced ones this year.”

To improve the division’s performance, Lands’ End is developing a national account executive field sales staff, sending e-mail newsletters, and building the unit’s Website. As part of its Web effort, Lands’ End has been developing customized Websites for large corporate clients — online company stores, as it were, accessible only to authorized employees of the clients.

“It’s their site,” Kleese explains. “When their employees go into this intranet site, they see, for example, Cisco products from Lands’ End.” Such intranet sites make Lands’ End a de facto preferred vendor to these billion-dollar clients, which are then more likely to place larger orders. But while Kleese has high hopes for these customized sites, “the catalog is still the biggest channel in our corporate sales,” she adds.

Lands’ End’s Corporate Sales division also plans to leverage its product-personalization capabilities this fall by producing shirts and other apparel with college logos, working in conjunction with select schools. The new effort is a collaboration with the consumer division, Kleese says.

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