Eddie Bauer History Case Study

Eddie Bauer History Case Study

Eddie Bauer is a leading clothing retailer in the United States based in Bellevue, Washington. Eddie Bauer founded the company in 1920, and the business has since been providing high-quality clothing, footwear, and outdoor equipment to customers worldwide. The company’s founder was also involved in many philanthropic causes throughout his life, including preserving marine wildlife, promoting environmental conservation, and protecting Native American rights. Here’s a quick look at the history of Eddie Bauer.

Eddie Bauer Overview

There are two divisions within Eddie Bauer Inc.: Eddie Bauer Sportswear and Eddie Bauer Home. Eddie Bauer Sportswear sells outdoor clothing and accessories, while Eddie Bauer Home sells bedding, home furnishings, and decor. Eddie Baur sends out 110 million catalogues per year, and around a quarter of its sales come from catalogue and website orders. North America has 430 Eddie Bauer sportswear stores, whereas the United States has 38 Eddie Bauer Home locations. An additional 52 Eddie Bauer Outlet locations in the United States and the eddiebaueroutlet.com online portal help the corporation get rid of overstock. The Otto family, the principal owners and operators of the world’s largest mail-order enterprise, owns and operates Spiegel, Inc., which is a wholly-owned subsidiary of Spiegel, Inc. Eddie Bauer maintains retail stores and distributes catalogues in Japan and Germany through joint ventures with Otto Versand divisions and has a cataloguing-only company in the United Kingdom.

Eddie Bauer History

Born in the Pacific Northwest in 1899, Eddie Bauer spent his formative years immersed in nature. A native of the Pacific Northwest with a love of the outdoors, Bauer started his first retail store at 20 after working for a local retailer for six years. His foresight in offering a money-back guarantee for any equipment he sold was the first indication of his natural marketing ability. He also had a talent for advertising and established trust by imagining the brand as a persona. As a skilled marksman, Bauer gained notoriety in the District of Columbia. Eddie Bauer was known for winning state championships in shooting clay pigeons while donning patches bearing the name Eddie Bauer. In 1929, he married Christine Heltborg. Here’s everything you need to know about Eddie Bauer’s history.

Sports Shop

When Eddie Bauer was just 21 years old, he opened his first business in downtown Seattle. “Eddie Bauer’s Tennis Shop” opened in the back of a nearby hunting and fishing store. Bauer’s store, which he first specialized in building and repairing, was only open during the tennis season so that he could devote the rest of the year to his athletic activities. Later, he added his handcrafted golf clubs and fishing gear to his product line and renamed his business “Eddie Bauer’s Sport Shop.” Bauer would go on to invent and patent a conventional shuttlecock. The Bauer Shuttlecock sparked the popularity of badminton in the United States. While running this initial business, Bauer formed his creed that focused on giving customers outstanding quality, value, and service, “and guarantees that we may be worthy of your high esteem,” which the company uses to date.

The Skyliner Jacket

While returning from a winter fishing excursion in the Olympic Peninsula, Bauer was caught by freezing rain. Due to his wet and frozen clothing, Bauer became dizzy and sluggish- the early stages of hypothermia. To alert a friend who was hiking far ahead of him, he fired three rifle shots before passing out under a tree before the overwhelming cold made him eventually pass out. After this, his efforts to find alternatives to thick wool clothing for outdoor people began. He quilted a down-filled jacket in an attempt to reduce its bulkiness. When Bauer exhibited the “Skyliner,” his first quilted goose down-insulated jacket, in his store in 1940, the U.S. Design Patent 119,122 was issued. Between 1934 and 1937, Bauer applied for more than 20 patents on various outdoor clothes and recreational equipment.

United States Army Air Corps

In 1942, Eddie Bauer was commissioned by the United States Army Air Corps to develop the B-9 Flight Parka. Parkas for World War II airmen totalled more than 50,000 pieces. As the name suggests, the park was created with pilot comfort. This was the only government supplier whose products could bear his company logo. Eddie Bauer also provided the military with backpacks, jeans, and sleeping bags issued to American troops throughout the conflict. Previously, the army was low on sleeping bags; Bauer sold more than 100,000 to the military due to his involvement.

Mail-Order Catalogues

Eddie Bauer’s first mail-order catalogue was published in 1945, not long after he began selling women’s apparel alongside men’s. Over 14,000 military personnel who had worn Eddie Bauer uniforms while serving were initially included in this email. One hundred twenty-five seamstresses worked for Bauer by 1949. Only sales at the factory showroom in Seattle kept him in business after closing his downtown store.

Partnership With William F. Niemi

After a catastrophic back injury and years of overwork, Eddie Bauer’s health deteriorated in 1950. He took on William F. Niemi, a local businessman, and his hunting partner. Reorganization of the store and increased cash flow was achieved after Bauer transferred all of Eddie Bauer, Inc.’s common stock to Niemi. Niemi helped Bauer decide to concentrate on the mail order catalogue.

By 1953, catalogue sales exceeded $50,000 in the United States dollars. Bauer re-joined the corporation as a stakeholder and partnered with Niemi in a 50/50 partnership at this point. For many years in the 1950s, Eddie Bauer, Inc. provided equipment and supplies for different scientific and exploratory endeavours worldwide.

The First American to Climb Mt. Everest 

Eddie C. Bauer and William Niemi Jr. joined their fathers, William and Eddie Bauer, as partners in the business in 1960. The American K2 Himalayan Expedition and many Antarctica-bound expeditions were all Eddie Bauer’s work. As the first American to scale Mount Everest in 1963, James W. Whittaker wore an Eddie Bauer parka. He was employed at REI. Throughout his journey, he wore just Bauer’s brand.

Eddie Bauer Retires and Sells Half of His Business to His Partners

William Niemi and his son bought Eddie Bauer’s part of the business for $1.5 million in 1968. The buyout was financed by investors who received equity in the company. Outside of Seattle, the first store opened in San Francisco that year. Their first significant store in Seattle’s downtown debuted in 1970. Niemi changed their focus to include casual lifestyle apparel to cater to a broader spectrum of customers. All retailers have also increased their focus on women’s clothing and accessories.

William Niemi Sells the Company to General Mills

General Mills bought Eddie Bauer from William Niemi in 1971, shifting the company’s focus from functional gear to casual clothing. The company’s revenue grew to $250 million by 1988. General Mills discontinued the tagline Expedition Outfitter after 1988. In 1987, Eddie Bauer created the All Week Long concept to provide women with clothes for all days of the week, such as business clothes for the office and just clothing for weekends. Initially, this concept was sold exclusively in a catalogue, but that has changed with the opening of a store in Portland, Oregon, in 1991. 

Partnership with Ford Motor Company

In 1983, Eddie Bauer signed a partnership with Ford Motor Company to produce Eddie Bauer Edition Ford vehicles. The first model, Eddie Bauer Bronco, debuted in 1984. The Eddie Bauer Ford vehicles were popular until 2010, with the last Eddie Bauer branded vehicles being the 2010 Explorer and Expedition.

Spiegel Buys Eddie Bauer

In 1988, Spiegel catalogue bought Eddie Bauer from General Mills. The company grew to 99 stores in the first year of operation due to aggressive expansion. More than 300 new locations had been added by 1996.

As early as 1991, Eddie Bauer introduced the Eddie Bauer Home line of housewares, including everything from furniture to tableware to decorative accents and bed linens. Customers who purchased clothing from the company were the target audience for the collection. A “warm and cozy” theme was carried through the store, with beds draped in thick blankets and wool rugs covering the floors.

1996 was pivotal for Eddie Bauer because it launched its first website and EBTEK System for high-performance outerwear and casual activewear. The EBTEK System has been engineered to be versatile and durable and consists of various fabrics such as Gore-Tex, Polartec 200, and Eddie Bauer Premium Goose Down. Eight new stores opened in Japan that year, which resulted in 14 stores and three outlets. More than that, Eddie Bauer Germany also opened two new stores in Germany.

In 1997, Eddie Bauer increased its total number of stores in North America and abroad to 500 and its total number of stores in Japan to 24. It also opened four Eddie Bauer outlet stores.

The company, which had up to that point been only an international licensee, now sought to penetrate Germany on its own by opening five new stores, for a total of seven in the country. Eddie Bauer licensed with the Lane Company for an exclusive collection of Eddie Bauer Home by Lane furniture, furthering their evolution into more than a mail-order company.

By 1998, over 500 stores had been opened in North America (556), Japan (32), and Germany (9). A licensing agreement between Eddie Bauer and Giant Bicycle, Inc. launched a line of Eddie Bauer Edition mountain bikes for off-terrain and city riding. The collections: the Eddie Bauer Eyewear Collection for men and women and the Eddie Bauer Baby by Eddie Bauer Home Collection for infants.

440 Industries Online Classes
440 Industries Online Classes

Eddie Bauer Files for Bankruptcy

In the year 2003, Spiegel declared bankruptcy. Eddie Bauer Inc. was put up for auction after the company’s catalogue and women’s apparel divisions were sold. More than 200 Eddie Bauer locations were shut down at the same time. Microsoft bought the company’s Redmond, Washington, headquarters for an undisclosed sum. While Bain Capital and Cerberus Capital Management had expressed interest in Eddie Bauer, Spiegel withdrew it from the auction due to a lack of an acceptable bid. As a result, Spiegel restructured its firm around Eddie Bauer’s operations, with Fidelity Investments, J.P. Morgan Chase, and Bank of America, each owning a stake in the newly formed independent Eddie Bauer Inc. Eddie Bauer Holdings hired Goldman Sachs in 2006 to investigate a possible sale.

Eddie Bauer LLC Gets Bankruptcy Protection

Chapter 11 bankruptcy protection was granted to Eddie Bauer on June 17, 2009. CCMP Capital Advisors, a private equity group, has agreed to buy the company for $202 million. CIT, GE Capital, and Bank of America have all committed to offering up to $100 million in financing throughout the bankruptcy proceedings. The sale to CCMP would take place via a bankruptcy court procedure known as a 363 transaction. Potential buyers could arise if a judge rules in favour of the transaction. If CCMP, a so-called stalking horse bidder, could lose during the court-supervised auction procedure, it was entitled to a $5 million breakup fee.

Eddie Bauer Today

Otis Sustainability Alliance was formed in May 2013 with the help of Disney, Nike, Patagonia, and Quiksilver. Eddie Bauer was one of the first garment businesses to join this effort. As a result of the collaboration, they hoped to improve the world’s environmental, social, and economic well-being. Eddie Bauer and Joseph A. Bank Clothiers were “in talks about an acquisition” in 2014, according to Women’s Wear Daily; the latter confirmed in February 2014 that “it will purchase Eddie Bauer in a deal valued at $825 million.” Since then, Men’s Wearhouse has bought out Jos. A Bank and will not acquire Eddie Bauer; this announcement was made in March 2014. Eddie Bauer and PacSun, another Golden Gate company, formed PSEB in 2018.

Final Thoughts

Eddie Bauer has been in the business of making high-quality apparel and equipment since 1920. The company started off selling furnishings out of his Seattle, Washington home before moving to larger quarters and adding more products to this line. Success hasn’t obscured the company’s awareness of past challenges. Rather than resting on its laurels, Eddie Bauer has been working hard to find new ways to build on its position as an industry leader.

Was This Article Helpful?

Eddie Bauer History Case Study Discover everything you need to know about Eddie Bauer- the man and the brand and learn where the company is today.
5 1 5 1

You're Never to Cool To Learn New Things

Please note: 440 Industries is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com.

#explore

#podcast

#learn

MORE ARTICLES FROM OUR BLOG