Living in the shadows of Victoria’s Secret and Bath & Body Works, the dynamic duo of new millennium brands, nearly killed The Limited Stores Inc.
After all, as quickly as fashions come and go, so does capital especially when a business is underperforming relative to others in the corporate portfolio.
“As Limited Brands started to focus more on Bath & Body Works and Victoria’s Secret, the apparel businesses did suffer from neglect,” says Linda Heasley, chairman and CEO of The Limited Stores, which was the cornerstone of Les Wexner’s fashion empire until its sale to Sun Capital Partners in August 2007.
It’s a move that benefited both enterprises.
Limited Brands shed itself of the last of its seven apparel businesses, which had become a drag on the corporation’s financials. The Limited Stores, which had become stagnant and unprofitable under Limited Brands, was now armed with new capital and ownership bent upon restoring the stores to their former glory.
“If we’d stayed with Limited Brands, we would always have gotten the second-level of attention and focus and capital,” Heasley says. “It would have been an ongoing struggle to get proper investments made in the business.”
Heasley isn’t bitter about the lack of attention and resources focused on The Limited Stores during the rise of Victoria’s Secret and Bath & Body Works. Quite the contrary. She credits Wexner with helping to make the brand a trendsetter of women’s fashion in the 1970s and ’80s, and she’s confident his vision will live on to see better days ahead.
“The good news is, despite ourselves, we hadn’t lost a lot of equity in our brand base,” she says. “The Limited is still a name people recognize as a good business.”
With Sun Capital’s $50 million equity investment in The Limited Stores and the additional $75 million line of credit Sun Capital arranged already Heasley is starting to see a turnaround.
“Since Sun has purchased us, we have started a program to refresh the [stores] and remodel,” she says. “Even things like replacing the carpet and painting fitting rooms we hadn’t done that in years. So that’s all very positive for the business. The focus has been very refreshing.”
In addition, the split from Limited Brands has allowed Heasley and her staff to explore new product lines, such as sleepwear, loungewear and accessories, that are breathing fresh life into a brand that was quickly becoming stale under its former corporate umbrella. Another plus: Ideas that would have taken months or years to get approval through the former corporate hierarchy are now able to be acted on almost immediately.
“Bottom line, we’re just a lot more nimble now,” Heasley says. Here’s how Heasley is working to take The Limited Stores from underperforming to over-the-top success.