How Levi Strauss Built an International Competitive Advantage MANAGING GLOBALLY
Levi Strauss the world’s largest clothing manufacturer, has 60 production facilities in 20 countries.
Robert Hass took control of the company in 1985.
-Levi’s was under attack from designer labels. -Slow to develop new styles -Innovation not respected -Not much aimed at increasing efficiency & responding to customers RESULT: MARKET SHARE WAS FALLING + COSTS WERE RISING (OTHER COMPANIES STARTED PRODUCING IN LOW LABOUR COST COUNTRIES EX: MEXICO, THAILAND & MALAYSIA)
Strengths: Reputation for high quality Known for durability Weaknesses: Low efficiency Low innovation TO INCREASE EFFICIENCY MOVED MANUFACTURING OPERATIONS TO MALAYSIA, INDONESIA, COSTA RICA AND OTHER LOW LABOUR COUNTRIES.
First introduced “Silver Tab” & loosefitting “ 500’ jeans.
Second, introduced “DOCKERS”
Dockers aimed at “Aging baby boomers” – a new line of clothing; khakis.
Hass realized that customers in different countries had different preferences regarding clothes & sizes.
Hass started a program to customize jeans to meet needs of global customers. Levi’s now sells over 200 different styles of blue jeans alone. SALES SOARED AS INCREASED EFFICIENCY HAS ALLOWED LEVI’S TO SELL ITS NEW CLOTHING AT LOW PRICES THAT APPEAL TO CUSTOMERS AROUND THE GLOBE.