NEW YORK — Limited Brands has made an attitude adjustment: it’s more purposeful, faster-moving, confident and poised to take greater risks.
That’s how Leslie H. Wexner portrayed the $9 billion company he commands, in his annual update to investors and analysts Wednesday in Columbus, Ohio, where Limited is based.
“I wouldn’t say the headline is cautious optimism. I would describe it as confidence,” said Wexner, Limited’s chairman and chief executive.
He said the company is moving faster on several fronts: product development, finding third-party brands to sell, creating retail concepts, recruiting and “on-boarding” employees.
“We can increase our new product commercialization by three to five [times]” the current pace, said Wexner. “We are just at the beginning of understanding how to work outside the organization, and inside the organization on how to bring new and better products to our customers.”
On the human resource side, “The recruiting process can’t take months. It has to take weeks.” In addition, the corporation has been promoting about twice as many executives, at the vice president level and higher, rather than relying as heavily on recruiting from other companies. “That’s a drastic difference from where we had been four years ago.
“In every aspect of the business, we want to be faster and have to be agile.”
After 9/11 and through the Iraq war, “it was not a great time to take risks,” Wexner said. “We were very much in a conservative mode. We were not trying to play offense. We were trying to play defense to get through things. That was a good mode for us to be in.
“We are shifting now. The world is still a dangerous place. There’s still uncertainty. But the things we can do under our control we feel very good about. There is substantial foundational progress. It’s beginning to look a lot like offense to me.”
Discussing two retail experiments — the C.O. Bigelow apothecary prototype and Henri Bendel branch, which both opened this week in the Easton Town Center near Columbus — Wexner said: “These are 3-D vignettes, more than mock-ups. They’re really places to [gauge] customer behavior and how they accept the ideas.” Bendel’s opened a handful of branches in the Nineties, but they flopped and were closed. The brand is revisiting a branch concept focused on personal care, beauty and lingerie.He added that “Bigelow is a kind of a Bath & Body elite. We know this market. It’s very large. We know it’s growing and that there is opportunity for segmentation.”
He also said he feels good about how the company is positioned. It’s been recapitalized, with “a capital structure that matches the existing business and how we see opportunities into the future” and streamlined, with “virtually no overhang of stores that should be closed.” The Limited Stores division was recently pared back to a base of about 300 units.
“We are at a better place today than anytime that I remember in terms of opportunity and foundation. I have been very happy. Almost every night, Abigail [his wife] asks me, ‘How do you feel?’ Most days I have this feeling that I have been tickled,” Wexner said.
In a rundown of his core businesses, Wexner ranked beauty and cosmetics as the number-one opportunity, lingerie, second and apparel, third.
He cited a “dramatic reshaping” of the beauty market and boasted that VS Beauty is approaching $1 billion in sales. “More share of wallet will go into that category for men and women.”
The True Blue spa collection, sold at Bigelow and Bath & Body Works stores “continues to grow,” while the Tutti Dolci proprietary body care line, just launched at both stores, is “testing very well.” Henri Bendel home and body care products are also selling very well, Wexner added.
“We’re building a new base of volume and comps because these products don’t cannibalize themselves,” Wexner said.
The $3 billion Victoria’s Secret and its subbrands, including Body by Victoria, Very Sexy and Pink, have “significant growth potential,” Wexner added, predicting that lingerie and intimate apparel will grow more rapidly than it has in the past.
With every division, the goal is to sell exclusive or near-exclusive products. “If Neiman Marcus sells Laura Mercier and we sell Neiman Marcus, I really don’t care,” the Limited chairman said. “If Wal-Mart sells Laura Mercier and we sell Laura Mercier, I give a damn.” He did temper the bullishness by characterizing business overall as “OK, kind of where we thought it would be,” and said it’s hard to know sales will be in the Christmas season. “In another month or so, we will know.”He characterized apparel as “not a great field of growth” and said the specialty apparel business as not as exciting as it was 20 years ago. Though with downsizing Limited Stores, establishing Express as a dual-gender business with a more upscale and designed assortment, among other changes, “progress in the apparel businesses in the last 12 months was greater than in the last 12 years.”