Too Much Baggage

Vera Bradley has been a major player in the women’s handbag and accessories market for nearly three decades, but the brand is struggling to expand its market. Can the queen of fresh prints get a handle on Millennials?

- Michella Tindera

Barbara Bradley Baekgaard’s home in suburban Fort Wayne, Ind. is a kaleidoscope of vibrant, colorful patterns, much like the signature quilted cotton bags and accessories produced by her company, Vera Bradley: The kitchen is wallpapered in a green-and white gingham, the master bedroom in a pink floral, the dining room in a diamond pattern.

Just a few miles away is Baekgaard’s old residence, where she and her then-neighbor Patricia Miller launched the firm in 1982 on a basement Ping-Pong table. The pair took a $500 initial investment—each woman anted $250—and turned it into a lifestyle and accessories business with $500 million in 2015 sales. And while Vera Bradley’s growth earned Baekgaard, 77, and Miller, 78, spots on FORBES’ list of richest self-made women, with estimated personal net worths of $270 million and $300 million, respectively, their business has been dropping like a heavy suitcase of late. The stock is down 39% since the company went public in 2010, net income is down 60% ($27.6 million in 2015) since its 2012 peak, and sales are down 6%, to $503 million, as the company struggles to recover from an overambitious post-IPO expansion.

Vera Bradley was born three decades ago during an airport layover. Baekgaard and Miller were traveling from Boca Raton, Fla. back to Fort Wayne, and while waiting for their flight, both noticed how drab women’s luggage looked. The two went home and “literally started the company the next day,” Baekgaard says. Named for Baekgaard’s mother, Vera, who was a model for Elizabeth Arden in the 1930's, the company began when she and Miller started using colorful printed cotton to sew duffels based on the popular Pierre Deux bags of the 1970s.