While most Yankees are good at warming their homes, the ones at The Yankee Candle Company (YCC) are also good at making their homes smell like Egyptian Cotton or Home Sweet Home. YCC makes and sells candles -- known for their burning longevity and strong fragrances -- in some 200 fragrances. It also sells candleholders, accessories, and dinnerware. Its products are sold by some 29,00 gift shops nationwide, as well as internationally in nearly 50 countries. The company operates about 550 stores in the US, mostly in malls, and sells online and through catalogs. With roots going back to 1969, YCC has been owned by Madison Dearborn Partners since 2007.
YCC was banking on growing as part of Madison Dearborn, but the downturn in the US economy and dismal climate for retailers led to a restructuring -- and a continued cautious outlook. As part of the plan, the company discontinued its Aroma Naturals line of soy-based candles, closed its Illuminations retail chain, and halted its consumer direct business. It then shifted its focus to Yankee Candle shops, opening its 500th location in Saugus, Massachusetts. While the moves -- combined with increasing sales -- have helped its bottom line, the company maintains a cautious outlook going forward. It plans to continue growing its store base in Massachusetts and other high-performing regions across the country, as well as work to keep costs under control with fiscally prudent planning.
The company generates more than half (57% in 2011) of its revenue from retail sales. The rest comes from wholesale (30%) and international (13%) efforts. While sales were up slightly among its largest business segments, YCC's international business saw the biggest boost in 2011. Sales overseas rose more than 35% as compared to the year earlier period, driven primarily by wholesale sales in the UK and its store within a store concession sales channel.
One area where the YCC business is boldly moving forward is its expansion northward. The candle maker opened its first company-owned stores in Canada in late 2011 with five locations in the Toronto area. While YCC has plans to open stores in other countries around the world, it has yet to specify which ones.
With scented candles generating about half of the estimated $3.7 billion US candle market, YCC maintains its core product line of Housewarmer and Country Kitchen candles. Emphasizing its more than 40 years in business, the candle company markets its products as distinctive and affordable luxuries and gifts.
YCC's target audience is women ranging in age from their early 20s into their 60s. Attempting to lure individuals outside of its core customer base, the company has introduced new products, such as electric devices that can be plugged into the wall and continuously dispense fragrance and "Car Jars" hanging tags (to scent the car).
The company operates two flagship stores: one in South Deerfield, Massachusetts, and one in Williamsburg, Virginia. The Massachusetts store spans 90,000 sq. ft. while the Virginia store is 40,000 sq. ft. The locations are popular attractions, featuring shopping, bakeries, candle-making activities, and holiday villages. The Massachusetts store is one of the most popular tourist stops in the state, drawing more than 3 million visitors each year. – less