L.L.Bean: 100% Satisfaction Guaranteed

L.L.Bean has thrived for over 100 years thanks to two core values that have effectively aligned the company’s business and operating models.

Company History

In 1911, Leon Leonwood (“L.L.”) Bean returned from a hunting trip with cold, wet feet. So, Bean decided to make a better hunting boot. With the help of a local cobbler, he attached the bottom part of rubber boots to leather uppers.

Hunting SHoe L.L. Bean’s Creation: Leather + Rubber = Better Boot.

Bean then decided to start a business. He touted the benefits of the boots and included a promise that forever shaped the company:

“We guarantee them to give perfect satisfaction in every way.”

At first, people weren’t satisfied with the product. The rubber bottoms separated from the leather uppers and over 90 out of the first 100 pairs were returned. Bean, however, was committed to his promise and refunded every unhappy customer.


This experience almost ruined L.L.Bean, but there was upside. It cemented two values that have shaped the company’s business and operating models since 1912:

  1. The Golden Rule: “Sell good merchandise at a reasonable profit, treat your customers like human beings, and they will always come back for more.”
  2. 100% Satisfaction Guarantee: “Our products are guaranteed to give 100% satisfaction in every way. Return anything purchased from us at any time if it proves otherwise. We do not want you to have anything from L.L.Bean that is not completely satisfactory.” [1]




Business Model

L.L.Bean’s business model is straightforward. It creates value by providing high quality merchandise and exceptional customer service. It captures value by pricing at a “reasonable” profit.

Customer service is the cornerstone of L.L.Bean’s business model. The company is ranked #1 in customer service among online retailers by Stella Service –  the “Nielsen for Customer Service” – beating other customer service titans such as Nordstrom and Zappos [2][3].

Four things separate L.L.Bean from the pack:

  • A Legendary return policy – There are virtually no restrictions. Customers can return almost anything, at any time, for any reason. Customers have even used the policy to return a “live Christmas wreath that had turned brown and a shirt ripped by a rescue crew after a car accident.” [4]
  • Free shipping – Bean “didn’t want anybody to have to pay extra to do business with him. So he charged a fair price, guaranteed what he sold and shipped it at no charge.” This still holds true. The company provides free shipping and handling in the US and Canada, with no minimums [5].
  • Fast responses – A live customer service representative can be reached quickly and easily at all times. The company’s responses are among the fastest in the industry across all channels: phone (20 seconds), email (<3 hours), and chat (7 seconds) [2].
  • Expert advice – L.L.Bean’s employees are extremely knowledgeable and go out of their way to help customers make informed purchases. Every retail store also runs Outdoor Discovery Schools to educate customers about the outdoors and L.L.Bean products [6].

The approach is working: 2014 sales were over $1.6 billion [6].

Revenues in 2015 will likely be even higher due to skyrocketing demand for the the classic (now extremely popular) L.L.Bean Boot and Boat and Tote Bag [7][8][9].

Operating Model

So, how does L.L.Bean do it?

Multiple Channels
The company has been a multichannel retailer since its earliest days running a retail catalog and a single store in Freeport, Maine (which has been open every day since 1951 to ensure excellent customer service). Since then, the company has maintained this approach by expanding to online and mobile, and opening dozens of stores in the US and Japan [6]. The company now has plans to triple its brick-and-mortar footprint to 100 stores, which will provide more customer touch points and even better service [10][11].

Work Environment
Great staff are the key to L.L.Bean’s customer service. So, the company has created an environment where they can flourish. In 2015, Forbes ranked L.L.Bean #5 on its list of America’s Best Employers and #1 in the Clothing, Shoes, Sports Equipment category [12]. This people-focused approach has paid off in low employee turnover. Twenty percent of employees have been at L.L.Bean for over two decades. Dana Connors, president of Maine’s Chamber of Commerce, puts it simply: “If you’re fortunate enough to get a job at Bean, you stay there.” [9] 

Customer Service Centers
L.L.Bean runs three customer service centers in Maine, which operate 24-7-365. During the busy holiday season the staff swells to nearly 2,500 representatives. This enables L.L.Bean to respond quickly to calls, emails, and text, despite high inbound volumes (over 130,000 contacts on the busiest day) [6].

To support its customer-friendly shipping policy, the company built considerable warehouse space and distribution infrastructure in Maine. The order fulfillment centers include a 1M sqft distribution site and employ as many as 2,500 people during the peak holiday season [6]. To support its 100% satisfaction guarantee, the company has also established a separate 135K sqft reverse logistics facility that specifically processes returns and exchanges [13].

Product Development and Manufacturing
To keep its offerings fresh, L.L.Bean operates a lab for analyzing new product materials, construction and design [6]. For products that are core to the brand (e.g., L.L.Bean Boots), the company has decided to keep manufacturing activities in Maine and sources materials in the US. Although this has caused a backorder for L.L. Bean Boots in recent years, the company is devoted to maintaining high quality standards and cautious not to overbuild capacity [7][9]. It also provides great publicity.


L.L.Bean’s recent jump in popularity might not last, but the company will make sure that its products, service, and reputation will. The company’s core values and strong alignment between business and operating models have made it successful for more than a century. If this continues, L.L.Bean could be successfully for a century more.


[1] L.L.Bean Wesbite: Our Story
[2] “STELLA BENCHMARKS FQ3 – 2015” (Stella Service)
[3] “StellaService, the Nielsen for Customer Service, Raises Another $15 Million” (Re/code)
[4] “What Happens When Stores Let Customers Return Whatever They Want?” (NPR)
[5] L.L.Bean Website: Free Shipping
[6] L.L.Bean Website: 2015 Company Fact Sheet
[7] “Why L.L. Bean’s Boots Keep Selling Out” (The Atlantic)
[8] “Consumers in Japan can’t get enough L.L. Bean tote bags” (Boston.com)
[9] “How Maine Bootmaker L.L. Bean Became Fashion’s Hottest Company” (Forbes)
[10] “Maine retailer L.L. Bean plans to triple its stores” (Boston Globe)
[11] “From Clicks to Bricks: L.L.Bean’s Embrace of Omnichannel Retail” (Urban Land)
[12] “America’s Best Employers” (Forbes)
[13] “Bean There, Returned That” (Inbound Logistics)


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Student comments on L.L.Bean: 100% Satisfaction Guaranteed

  1. Really enjoyed reading this article! Interesting to hear about LL Beans’s initial failures with the boots and how they recovered. LL Bean has been open about other failures and how they improve, like when they decided to have more stores open 24/7 like the flagship strore. This leads me to belive that Bean is OK with failures as long as it drives innovation and change.

    Another point I think is interesting with LL Bean is the channel management, especially since they still use catalogs. I would love to know how LL Bean uses analytics, especially since I am sure they collect very different information for each source (e.g., time on website v. sales per sqft in a store).

  2. Solid work! You mentioned that there have been backorders for L.L. Bean Boots in recent years. Do you think that this is an operational choice that is trying to introduce an element of scarcity into the business model? As you pointed out, the Company is hesitant to increase prices (which would be the value maximizing option), but is also wary of increasing production facilities outside Maine.

  3. Sounds like LLB has carved out a great position with their high product quality and customer service. My biggest concern is future growth potential for the brand. You mentioned Bean Boots enjoyed a recent surge in popularity over the last year or two. But I’d be uncomfortable as LLB basing my long term projections on the hope that the boots return to popularity after the inevitable fade. While the company clearly makes more than just Boots, the salient point is LLB doesn’t prioritize innovation in their product line. They sell their boots, flannel, and other New England staples. Is that enough to create value going forward, or do they need to start rebranding as the preferred clothing option for both traditional and modern New England? Maybe they should focus on getting a CEO with a name as good as “Leon Leonwood.”

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