Henri Bendel is going dark.
Owner L Brands Inc. said late Thursday that it has decided to shut down the division. Bendel has for years suffered losses which can be attributed to management changes, flip-flopping merchandising strategies and attempts at expansion. Ultimately, the business proved to be more of a distraction for L Brands than a growth opportunity.
The company said all 23 Henri Bendel stores, including the Fifth Avenue flagship as well as the Henri Bendel e-commerce Web site, will close by January 2019, though new merchandise will continue to arrive through the holiday season.
“We are committed to improving performance in the business and increasing shareholder value. As part of that effort, we have decided to stop operating Bendel to improve company profitability and focus on our larger brands that have greater growth potential,” said Leslie Wexner, chairman and chief executive officer of L Brands. “This decision is right for the future growth of our company, but not easy because of the impact to our L Brands family. I want to thank our Bendel associates for their dedication to this iconic brand and to our loyal Bendel customers.”
When L Brands, formerly called The Limited, acquired Henri Bendel in 1985, Wexner predicted that Bendel could ultimately become a $1 billion luxury business. The goal never came close to reality. On Thursday, the company disclosed Henri Bendel’s revenues for 2018 would total about $85 million while operating losses would come in around $45 million. The costs to close the business have yet to be tallied.
One of the most serious challenges Bendel faced under the Limited ownership was procuring upscale brands and designer lines, the kind that were sold at nearby Bergdorf Goodman and Saks Fifth Avenue. With a lack of luxury offerings from the market, Bendel found itself pursuing alternative strategies and struggled to find its identity, changing its merchandising focus over the years. In 2014, the company cut off ties with third-party vendors, and has of late been selling accessories under the Bendel label, as well as beauty products. Last year, WWD reported that Bendel was once again considering opening its doors to brands other than its own.
But by shedding Bendel, L Brands will be able to put more effort into turning around its now struggling Victoria’s Secret business.
When Wexner decided his company should purchase Bendel in the mid-Eighties, he relocated the business from its modest but long-standing location at 10 West 57th Street to a much more spacious and lavish location on Fifth Avenue. Wexner created a true and lavish flagship for Bendel, with six levels and 80,000 square feet housed at the base of a $200 million mixed-used tower at 712 Fifth Avenue, with a hotel, apartments and offices. The Bendel flagship is between 55th and 56th streets on Fifth Avenue, opposite Trump Tower.
The store was founded by Frenchman Henri Bendel in 1895 as a hat shop on East Ninth Street in Manhattan. The business relocated to 57th Street in 1912.
Under the management of the late, legendary Geraldine Stutz, and as a single-unit operation, Bendel became a chic, international fashion destination filled with avant-garde designer collections. It was best known for its innovative “Street of Shops” on the ground floor, housing an eclectic and cutting-edge array of products in a range of categories. The format was widely copied by many retailers for years but those knock-offs never captured the cachet or spirit of what was Bendel, which employed Andy Warhol as an illustrator in the Sixties.
Stutz ran the business since 1957, became an owner along with other investors, and sold the store to Limited in 1985.
L Brands said that its associates staying with the business through January will be offered retention bonuses. At the point when associates’ positions are eliminated, they will be invited to interview for open positions within the company or will be offered separation pay and job search support services.
Aside from Victoria’s Secret and Bendel, L Brands also operates Pink, Bath & Body Works and La Senza and operates 3,084 company-owned specialty stores in the U.S., Canada, the U.K. and Greater China, and its brands are sold in more than 800 additional franchised locations worldwide.