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| Levi Strauss & Co. | |
|---|---|
 | |
| Type | Private |
| Founded | 1853 |
| Headquarters | San Francisco, California |
| Key people | John Anderson, CEO & President of LS&CO |
| Industry | Clothing |
| Website | http://www.levi.com |
Levi Strauss & Co. (LS&CO) is a privately held clothing company known worldwide for its Levi\'s brand of denim jeans. It was founded in 1853 when Levi Strauss came from Bavaria, Germany to San Francisco, California to open a west coast branch of his brothers\' New York dry goods business. Although the company began producing denim overalls in the 1870s, modern jeans were not produced until the 1920s. The company briefly experimented (in the 1970s) with employee ownership and a public stock listing, but remains owned and controlled by descendants and relatives of Levi Strauss\' four nephews.
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Levi Strauss & Co. is a worldwide corporation organized into three geographic divisions: Levi Strauss, North Americas (LSNA), based in the San Francisco headquarters; Levi Strauss Europe (LSE), based in Brussels; and Asia Pacific Division (APD), based in Singapore.The company employs a staff of approximately 8,850 people worldwide, and owns and develops a few brands. Levi\'s, the main brand, was founded in 1873 in San Francisco, specializing in riveted denim jeans and different lines of casual and street fashion.http://www.levi.com
In the 1970s, Great Western Garment Co. (GWG), a Canadian clothing manufacturer, was acquired by Levi Strauss. GWG was responsible for the introduction of the modern stone washing technique, still in use by Levi Strauss. 2004 saw a sharp decline of GWG in the face of global outsourcing, so the company was closed and the Edmonton manufacturing plant shut down.http://www.conestogac.on.ca/~sfinlay/IMC/cases/LevisGWG.htm Dockers was launched in 1986.http://www.dockers.com Sold largely through department store chains, helped the company grow through the mid-1990s, as denim sales began to fade. Levi Strauss attempted to sell the brand in 2004 to relieve part of the company\'s $2 billion outstanding debt.http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2005/09/11/BUGT5EKGG91.DTL&hw=advertising&sn=001&sc=1000
Launched in 2003, Levi Strauss Signature features jeanswear and casualwear.http://www.levistrausssignature.com In November 2007, Levi\'s released a mobile phone in co-operation with ModeLabs. Many of the phone\'s cosmetic attributes are customisable at the point of purchase.
Jacob Davis was a tailor who frequently purchased bolts of cloth from Levi Strauss & Co.\'s wholesale house. After one of Davis\' costumers kept purchasing cloth to reinforce torn pants, he had an idea to use copper rivets to reinforce the points of strain, such as on the pocket corners and at the base of the button fly. Davis did not have the required money to purchase a patent, so he wrote to Levi suggesting that they both go into business together. After Levi accepted Jacobs\' offer, on May 20, 1873, the two men received patent #139,121 from the United States Patent and Trademark Office. The patented rivet was later incorporated into the company\'s jean design and advertisements. Contrary to an advertising campaign suggesting that Levi Strauss sold his first jeans to gold miners during the California Gold Rush (which peaked in 1849), the manufacturing of denim overalls only began in the 1870s.
Modern jeans began to appear in the 1920s. In the 1950s and 1960s, Levi\'s jeans became popular among a wide range of youth subcultures, including greasers, mods, rockers, hippies and skinheads. Levi\'s popular shrink-to-fit 501s were sold in a unique sizing arrangement; the indicated size was related to the size of the jeans prior to shrinking, and the shrinkage was substantial. The company still produces these unshrunk, uniquely sized jeans, but they don\'t sell very well.
By the 1990s, the brand was facing competition from other brands and cheaper products from overseas, and began accelerating the pace of its US factory closures and its use of offshore subcontracting agreements. In 1991, Levi Strauss faced a scandal involving six subsidiary factories on the Northern Mariana Islands, a US commonwealth, where some 3% of Levi\'s jeans sold annually with the Made in the USA label were shown to have been made by Chinese laborers under what the United States Department of Labor called "slavelike" conditions.
Cited for sub-minimal wages, seven-day work weeks with 12-hour shifts, poor living conditions and other indignities, Tan Holdings Corporation, Levi Strauss\' Marianas subcontractor, paid what were then the largest fines in US labor history, distributing more than $9 million in restitution to some 1,200 employees.http://www.cleanclothes.org/companies/levi5-5-98.htmhttp://www.thestandard.com.hk/stdn/std/Weekend/FL18Jp16.htmlhttp://www.house.gov/georgemiller/cnmiarticle.html Levi Strauss claimed no knowledge of the offenses, then severed ties to the Tan family and instituted labor reforms and inspection practices in its offshore facilities.
The activist group Fuerza Unida (United Force) was formed following the January 1990 closure of a plant in San Antonio, Texas, in which 1,150 seamstresses (primarily Latina) — some of whom had worked for Levi Strauss for decades — saw their jobs exported to Costa Rica.http://www.accd.edu/pac/lrc/chicanaleaders/fuerzaunida.htm During the mid and late 1990s, Fuerza Unida picketed the Levi Strauss headquarters in San Francisco and staged hunger strikes and sit-ins in protest of the company\'s labor policies.http://www.inmotionmagazine.com/fplpf.htmlhttp://www.hartford-hwp.com/archives/26/147.htmlhttp://www.zmag.org/levihunger.htm
The company took on multi-billion dollar debt in February 1996 to help finance a series of leveraged stock buyouts among family members. Shares in Levi Strauss stock are not publicly traded; the firm is today owned almost entirely by indirect descendants and relatives of Levi Strauss, whose four nephews inherited the San Francisco dry goods firm after their uncle\'s death in 1902.http://www.levistrauss.com/Financials Levi\'s bonds are traded publicly, as are shares of the company\'s Japan affiliate, Levi Strauss Japan K.K.
In June 1996, the company offered to pay its workers an unusual dividend of up to $750 million in six years\' time, having halted an employee stock plan at the time of the internal family buyout. However, the company failed to make cash flow targets, and no worker dividends were paid.James Sterngold. "Levi Strauss Offers To Pay A Dividend To Workers", The New York Times, June 13, 1996. In 2002, Levi Strauss began a close business collaboration with Wal-Mart, producing a special line of "Signature" jeans and other clothes for exclusive sale in Wal-Mart stores until 2006.http://www.cio.com/archive/071503/levis.html Levi Strauss Signature jeans can now be purchased at several stores in the US, Canada and Japan.http://www.levistrausssignature.com
The company is now Wal-Mart\'s largest worldwide strategic partner, conforming to Wal-Mart\'s business and labor practices.http://www.cio.com/archive/071503/levis.html] Levi Strauss & Co. closed 58 US manufacturing plants between 1981 and 1990, sending 25% of its sewing operations overseas.http://www.fastcompany.com/magazine/77/walmart.html Levi\'s accelerated US plant closings through the 1990s, closing its last US domestic plant (in San Antonio, Texas) in January 2004.http://findarticles.com/p/articles/mi_qn4188/is_20040109/ai_n11433720[http://www.georgebrainard.com/editorial/page6.html
According to the New York Times, Levi Strauss leads the apparel industry in trademark infringement cases, filing nearly 100 lawsuits against competitors since 2001. Most cases center on the alleged imitation of Levi\'s back pocket double arc stitching pattern (U.S. trademark #1,139,254]).[http://tarr.uspto.gov/servlet/tarr?regser=registration&entry=1139254 Levi\'s has sued Guess?, Esprit Holdings, Zegna, Zumiez and Lucky Brand Jeans, among other companies.http://www.nytimes.com/2007/01/29/business/29jeans.html
By 2007, Levi Strauss was again said to be profitable after declining sales in nine of the previous ten years.http://www.mercurynews.com/businessheadlines/ci_6346739 Its total annual sales, of just over $4 billion, were $3 billion less than during its peak performance in the mid 1990s.http://www.latimes.com/business/la-fi-levi11apr11,1,293145.story After more than two decades of family ownership, rumors of a possible public stock offering were floated in the media in July 2007.http://marketplace.publicradio.org/shows/2007/07/11/PM200707114.html
Robert Schmidt and Thomas Walsh had significant leadership roles at Levi Strauss & Co. (LS&Co), as directors of the global tax department.Robert Schmidt and Thomas Walsh v. Levi Strauss & Co., et al, U.S. District Court , Case 5:04-cv-01026-RMW (Northern District of California 03/12/2004) While employed by LS&Co. in that capacity, they were instructed to withhold material documents from the IRS and to limit information to LS&Co.’s new auditor, KPMG. Schmidt and Walsh refused, advising their supervisors that they would not be a party to fraud. On December 10, 2002, LS&Co. summarily fired the two directors. LS&Co.’s termination of Schmidt and Walsh occurred approximately five days before KPMG arrived on site to conduct a comprehensive audit of the company. The trial in this litigation is scheduled to start March 31, 2008 in the US District Court in San Francisco, California.
Gerald R. Brookman was hired by LS&Co on January 18, 2005 as an IMS/DB2 systems programmer at the company\'s Westlake, Texas IT facility, at a starting yearly salary of $85,000.DL/2 Product from Circle-Group/Lightyear (2005-02-18). Retrieved on 2008-01-28.Gerald R Brookman v. Levi Strauss & Co, U.S. Department of Labor , Case 2006-SOX-36 (Office of Administratrive Law Judges 11/14/2006) When the Sarbanes-Oxley Act (SOX) audit conducted by E&Y in 2Q05 revealed major deficiencies, senior LS&Co. management ordered Brookman and others to conceal these problems from KPMG. On October 20, 2005, Broookman and all six employees of the transportation department in the Little Rock, Arkansas nationwide distribution center were terminated. LS&Co.’s termination of Brookman and the "Little Rock Six" occurred approximately four days before KPMG arrived on site to conduct an audit. A civil RICO federal lawsuit has been filed against LS&Co. on behalf of Brookman, the "Little Rock Six", and 74 other LS&Co SOX whistleblowers who were terminated in 2005.
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