LEVI STRAUSS & COMPANY

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 18! when Levi "trauss came to
"an #rancisco$ %alifornia to open a west coast branch of his brothers' &ew 'ork dry
goods business. (lthough the company began producing denim overalls in the 18)*s$
modern jeans were not produced until the 1+,*s. -he company briefly e.perimented /in
the 1+)*s) with employee ownership and a public stock listing$ but remains owned and
controlled by descendants and relatives of Levi "trauss' four nephews.
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COMPANY
PROFILE


Contact Information
(ddress0 11 1attery "t.
"an #rancisco$ %( +2111
3hone0 214*145***
#a.0 214*14)11,

LEVI STRAUSS & COMPANY
(merican %lothier %ompany
%ompany passed to four nephews after "trauss' death$ 18)!6
%ompany went public$ 1+)1 /family members retained controlling interest)6
publicly4held shares repurchased by family members$ 1+86
first non4family member %78 takes reins$ 1+++6
Collections: "mithsonian Institution$ 9ashington$ :.%.
Awards: %oty "pecial award$ 1+)1.
Company Website: http0;;www.encyclopedia.com;doc;www.levistrauss.com.
Organization
Levi "trauss < %o. is a worldwide corporation organi=ed into three geographic divisions0
Levi "trauss$ &orth (mericas /L"&()$ based in the "an #rancisco head>uarters
Levi "trauss 7urope /L"7)$ based in 1russels
(sia 3acific :ivision /(3:)$ based in Singapore
Top Competitors
? -he @ap Inc. /gps)
? A.#. %orporation /vfc)
? 9al4Bart "tores$ Inc. /wmt
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LEVI STRAUSS & COMPANY
-he company owns and develops three major brands0
Dockers
/http0;;www.dockers.com) Launched in 1+85$ defined as Cstylish and comfortable casual
wearC for men and women. "old largely through department store chains$ :ockers were
the engine of the company's spectacular success and growth up to and through the mid4
1++*s /even as denim sales began to fade). Levi4"trauss attempted to sell the brand in
,**2 to relieve part of the company's D, billion outstanding debt.E1F
Levi's
/http0;;www.levi.com) -he main brand$ founded in 18)! in "an #rancisco speciali=ing in
riveted denim jeans /including the world4famous *1s) and different lines of casual and
street fashion.
Levi Strauss Signature
/http0;;www.levistrausssignature.com) Launched in ,**!$ defined as Chigh4>uality$
affordable$ fashionable Geanswear and casual wear from a company and name they
trust.C "old at 9al4Bart$ Hmart$ -arget$ 3amida$ Beijer$ 8rchard "upply Iardware
"tores and "hopHo stores in J"6 9al4Bart and Kellers in %anada and Gusco$ Lapty$
%ecile and "hop %hannel "tores in Gapan.
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LEVI STRAUSS & COMPANY
SCOPE of Study
Understanding Strategy adopted by LEVI STRAUSS
& COMPANY to retain its maret s!are"
E#p$ore t!e reason !o% a maret $eader &an $oose its
maret s!are signi'i&ant$y"
E#amine and ana$y(e t!e ey e$ements o' t!e
restr)&t)ring and reengineering e#er&ise )ndertaen
by &ompany"
St)dy t!e mareting initiati*es adopted by LS & CO"
to ta&$e gro%ing &ompetition"
Ana$y(ing &!a$$enges 'a&ed by a maret $eader d)e to
&!anges in t!e ind)stry in'rastr)&t)re"
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LEVI STRAUSS & COMPANY
OBJECTIVE
-he basic objectives behind taking up ML7AI "-L(J"" <
%8B3(&'N as the subject of this project report are0
-o make brief study of %ompanyOs history in 3roduct and
Barketing.
-o make brief study of %ompanyOs restructuring and
reengineering projects undertaken in the past to
improve efficiency.
-o briefly analy=e %ompanyOs strategies to tackle
growing competition and maintaining strategic sales.
-o make detailed study of %ompanyOs market sales in
past 2 years.
-o analy=e key factors behind %ompanyOs success
around the world.
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LEVI STRAUSS & COMPANY
HISTORY
LEVI STRAUSS
(1829-1902)
Levi "trauss and %ompany is the largest brand4name apparel manufacturer in the
world. -he "an #rancisco$ %alifornia4based company designs$ manufactures and
markets branded jeans$ dress pants and casual sportswear for men$ women and
children. 3roducts include jeans$ shirts$ jackets$ skirts and fleece wear$ primarily
marketed under the Levi's$ :ockers$ n "ignature trademarks. In 1++8 Levi's reported
worldwide employment to be appro.imately !*$*** people$ down from !)$** the year
before /L"<%8$ 1++8b6 L"<%8$ 1++)b). In ,**)$ Levis had appro.imately 11$*
employees with an 7mployee growth rate of about 8.1P. %urrently$ Levis has
appro.imately 1*$*** employees worldwide$ including appro.imately 1$*1* at its "an
#rancisco$ %alifornia Iead>uarters.
-he company was founded in 18! by Levi "trauss$ a 1avarian immigrant to the Jnited
"tates. Iis original business sold clothing and dry goods on the docks of "an
#rancisco$ during the @old Lush era. (t this time "trauss began to produce trousers
sewn from tent canvas to meet the needs of his miner and laborer customers who were
seeking durable clothing. 1y the 18)*s the pants were being produced out of denim.
(fter 9orld 9ar II the company dropped its interest in wholesale dry goods and
e.panded production to include casual wear and preshrunk jeans$ setting up their first
national sales forces as the jeans market took off. "i. decades of growth followed.
Geans evolved from the attire of cowboys and laborers to that of defiant youth. In the
1+5*s Levi's set up a distribution network in 7urope$ purchased )P of the top jeans
maker in %anada$ and set up overseas production facilities. 3roduct lines were
e.tended to include 9hite Levis$ an apparel line for women$ and corduroy pants. Levi's
remained a private company for its first 118 years until it went public in 1+)1$ changing
its name to Levi "trauss (ssociates and issuing new stock shares at a time when the
jeans market in the J.". and overseas was Ce.ploding.C 1y the 1+8*s$ a decision was
reached to make the company private again. ( leveraged buyout began in 1+8 and
was completed in 1++5 /Battera$ 1++,0 21)42186 #innie$ 1++50 1!).
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LEVI STRAUSS & COMPANY

Levi "trauss < %o. is one of the world's largest brand4name apparel marketers with
sales in more than 11* countries. -here is no other company with a comparable global
presence in the jeans and casual pants markets. Its market4leading apparel products
are sold under the Levi'sQ$ :ockersQ and Levi "trauss "ignatureQ brands.
Levi "trauss < %o. is privately held by descendants of the family of Levi "trauss.
"hares of company stock are not publicly traded. "hares of Levi "trauss Gapan H.H.$
companyOs Gapanese affiliate$ are publicly traded in Gapan.
Levi "trauss markets apparel in more than 5* countries and it has ! production
facilities and !, customer service centers in 2+ countries. -he company operates wholly
owned businesses in most 7uropean countries$ in "outh (frica$ (ustralia$ Gapan$ Iong
Hong$ India$ -he 3hilippines$ Balaysia$ &ew Kealand$ "outh Horea$ -aiwan$ 1ra=il and
(rgentina$ and operates through joint ventures and licensing agreements in a host of
other countries.

History: Restructuring and Reengineering
:uring the past decade the strategic vision that has guided Levi "trauss and %o.$
shaped largely by %hief 7.ecutive 8fficer Lobert Iaas and former %hief 8perating
8fficer -homas -usher$ has resulted in ongoing change within the company.
In 1+82 Iaas$ the grandnephew of founder Levi "trauss$ was appointed %78. Iaas$
the valedictorian of his 1( class at the Jniversity of %alifornia at 1erkeley$ a 1aker
scholar at Iarvard Jniversity where he earned an B1($ was a 9hite Iouse #ellow in
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LEVI STRAUSS & COMPANY
the Gohnson (dministration$ a 3eace %orps volunteer in the Ivory %oast and a
BcHinsey < %o. consultant before he joined the company in 1+)! /"herman0 ). -usher$
whose background is in marketing$ joined Levi's in 1+5+ /-redre$ 1++a0 5).
3rior to Iaas' stint as chief e.ecutive the family shareholders had decided to take the
company public$ given what seemed like a limitless history of growth and a promising
future. -he company had embarked on a period of diversification and e.pansion$
ac>uiring several apparel firms throughout the late 1+)*s and early 1+8*s. -his
coincided with the period during which Levi's was traded publically. -he business press
characteri=es this period of following C9all "treet demandC as a Cdisaster.C In 1+82
Levi's net income had dropped 8*P from four years before . -hat year a decision was
made to refocus on core products and most of the ac>uired companies were sold. /#or
a listing of Levi "trauss holdings. -wenty4three plants were closed and 5$** people
were layed off /"cott$ 1+80 1+). Iaas took Levi's private again in what was then the
largest leveraged buyout in J.". corporate history /D1.5 billion) /-redre 1++a$ #innie$
12).
9hile Iaas /described in a 1++) profile as Cmeticulous$C CdeliberateC and focused solely
on work$ family and philanthropy) has been at the helm Levi's net income had gone up
18 times$ to reach D)! million$ and by the end of 1++5 revenues during his tenure had
tripled. "ince Iaas has been %78 the company's stock increased over 1** times.
8utside of the J.". jeans market$ the company is reportedly enjoying fewer problems
and increasing success0 C-he firm's current difficulties are limited to the (merican jeans
market. Levi's denim products are still doing well overseas6 its :ockers casual wear$
which had an awkward spell three years ago$ has been restructured and is having its
best year ever6 and its new more formal "lates line is meeting its targetsC /T!e
E&onomist$ 1++)). :espite a proposal from family shareholders to take the company
public again in 1++5$ Iaas has held firm .
Beanwhile$ a major Cre4engineeringC effort started in 1++1$ focusing on the J" and
geared toward moving products through the manufacturing and distribution process
more >uickly$ improving customer service and forging close and;or strategic
relationships with suppliers and retailers. In the production system major changes
included the introduction of a teamwork system /(lternative Banufacturing "ystems4
(B") in which employee pay is connected to the performance of the team to which they
belong$ made up of ,*4!* people. (nother aspect of re4engineering in the supply chain
was an electronic data link to Levi's largest clients and automated distribution centers.
#irst estimated to cost about D** million$ the ambitious re4engineering project
ballooned to D8* million by 1++2 when the Levi's board demanded the process be
slowed down .
/1!)

In late 1++) Levi's reportedly was operating ! plants in * countries /1loomberg &ews$
1++)). %omprehensive recent information on Levi's operations on a global scale is
difficult to come by$ especially data regarding the considerable amount of work that is
contracted out.
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LEVI STRAUSS & COMPANY
-he following sections based on 1++) figures on Levi's &orth (merica$ (sia;3acific and
7uropean operations suggest that changes continued to take place in all regions.
Nort! Ameri&a
Levi "trauss < %o. had !, J.". factories and 2 %anadian factories /employing ,$2**)
/L"<%8$ 1++)b6 Leuters$ 1++)a6 1loomberg 1++)). In #ebruary 1++)$ Levi's
announced that it would eliminate 1$*** white4collar jobs /,*P of its salaried work
force)$ achieving a savings of D8* million /T!e E&onomist$ 1++)6 +ai$y Ne%s Re&ord$
1++) ). 1y the end of the year the company announced plans to close 11 of its J.".
plants by Guly$ 1++8. -he plant closures
/12)

mean layoffs for 5$!+ employees /or !2P of the company's total J.".; %anadian
manufacturing workforce) and represent one of the largest layoffs in the J.". in 1++)
/L"<%8$ 1++)b6 T!e E&onomist 1++)).
/1)

(t the time of the announcement Levi's was operating !, manufacturing plants and
finishing centers in the J.". and five in %anada /L"<%8$ 1++)b). -he four %anadian
factories /located in 8ntario and (lberta) are all unioni=ed /Ma,)i$a Net%or Update$
1++80 )).
Levi's said the jobs will not be shifted overseas$ but instead the work will be picked up
by workers at other Cmore efficientC facilities in the J.". as a means of dealing with
overcapacity and Csluggish demandC /T!e E&onomist$ 1++)0 826 9aters$ 1++)0 18).
/15)

C-his is not job flight$C said Iaas />uoted in Bedaille and 9heat$ 1++)0 ,). 8nce these
layoffs are made$ for the first time in its history Levi's will have Cmore foreign than
domestic workersC /Bedaille and 9heat$ 1++)0 ,).
(ccording to Levi's$ the D,** million severance package$ negotiated with the Jnion of
&eedle trades Industrial and -e.tile 7mployees /J&I-7R)$ which represents four of the
plants$ and the Jnited #ood and %ommercial 9orkers /J#%9)$ which represents two of
the plants$ Cfar e.ceeds apparel industry standardsC /L"<%8$ 1++)b).
Included in the benefits package announced in &ovember 1++) are0
4 eight months notice
4 up to three weeks severance pay per year of service
4 out4placement and career counseling services for si. months /services vary by
location)
4 continuation of health care benefits through %81L( for up to 18 months
4 a D** new job bonus paid to employees upon securing new employment
4 a D5$*** allowance that can be applied to a menu of benefits$ easing e.penses
associated with relocation$ education and retraining$ dependent care and small
business start4up
4 an early retirement window for eligible employees /employees participating in the
company's pension plans and who have reached age * and completed at least 1
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LEVI STRAUSS & COMPANY
years of service)
7mployees eligible for the company's employee incentive program /C@lobal "uccess
"haring 3lanC) who are laid off due to these plant closures will receive a full payout in
,**, if the company meets its financial performance and cash flow objectives.
/1))

/source0 L"<%8$ 1++)b)
In addition$ Levi's did publici=ed their intent to secure and pursue appropriate
government assistance programs to aid the displaced workers /such as e.tended
unemployment benefits$ job training support$ job search allowance and relocation
funds)$
/18)

and earmarked D8 million for a %ommunity -ransition #und to assist the affected
communities over the ne.t three years /L"<%8$ C3lant %losure 1enefit #act "heetC).
In this latest round of restructuring of its &orth (merican operations$ Levi's seems to
have benefited from lessons learned during J." plant closures that occurred earlier in
last decade0
In Ganuary 1++*$ Levi "trauss < %o. laid off over 1$1** employees when it shut down a
plant producing :ockers and 8fficers %orp jeans in "an (ntonio$ -S /where operators
reported wages of D+.1* per hour) and shifted the production operation to %osta Lica
/where workers were paid D1.*8 hour) /7rlich$ 1++,). In "an (ntonio the non4unioni=ed
mostly Latina production workers reported earning Cgood wages for the regionC and
following the layoff announcement /in some cases workers received only ,2 hours
notice /%hiang and "olis$ 1++20 ,,)) they came together as -)er(a Unida /Jnited
#orce)$ held weekly meetings$ rallies$ picket lines$ demonstrations and a /high4profile)
national boycott in pursuit of a satisfactory severance package. 9orkers also filed suit
against Levi's$ charging racial discrimination and demanding compensation for on4the4
job injuries$
/1+)

claiming that fewer than 1* P of injured workers filed claims due to fears of
management retaliation /7rlich$ 1++,).
-he company claims they offered the workers +* days notice /5* days are re>uired)$ as
well as e.tended medical benefits for three months$ and job retraining 44 Cwell beyond
legal re>uirementsC according to :avid "amson$ a Levi's spokesperson />uoted in
7rlich$ 1++,). -he workers received just one week's pay per year of service and no early
retirement option /Ma,)i$a Net%or Update$ 1++80 )). "ome of the funding for worker
retraining came not from Levi's but agencies such as the J" #ederal @overnment's
-L(;G-3( program that funds retraining through community colleges /%hiang and "olis$
1++20 ,,). #ollowing the 1++) layoff announcement$ #uer=a Jnida reiterated its
commitment to securing a satisfactory severance package for the women laid off in
1++* and sounded the call once again for a boycott of Levi's products /-hornburg$
1++8).
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LEVI STRAUSS & COMPANY
In 1++2$ 1*+ employees at an 7l 3aso manufacturing facility filed suit$ charging
employment discrimination and claiming that the company's Creturn to workC programs
for employees receiving workman's compensation /again$ most suffered from carpal
tunnel syndrome) were used to force workers to >uit /L"<%8$ 1++)a6 @ardenier$ 1++)0
!). &early three years later the cases of five plaintiffs were successfully argued in 7l
3aso /the remaining plaintiffs had their day in court in a serious of separate cases). 8n
"eptember 8$ 1++) the jury awarded the plaintiffs D5**$*** each in compensatory
damages and the day after announced a D1* million award to the plaintiffs for punitive
damages. Beanwhile$ Levi's appealed the verdict and demanded the dis>ualification of
the presiding judge$ Gohn L. #ashing$ from further proceedings. Levi's "enior Aice
3resident and @eneral %ounsel (lbert Boreno said there was Cno basisC for the court's
findings and termed the damages awarded Coutrageous$ unwarranted$ and egregious.C
Ie accused Gudge #ashing of Cnaked disregard for his obligations under -e.as lawC and
e.pressing Copen hostility...during the trail toward Levi "trauss and %ompany and its
legal counselC />uoted in L"<%8$ 1++)a).
#uer=a Jnida suggests that the planned shutdown of three Levi's facilities in 7l 3aso in
Guly$ 1++8 is linked to the D1*.5 million suit won by the e.4Levi's 7that timel 3aso
employees /9%L%$ &ov. )$ 1++)).
E)rope
Leali=ing the appeal of their products to 7uropean consumers$ Levi's established an
overseas presence early on. CIn 1++!$ 5.8P of sales were conducted in the J"(...$
,,.5P in 7urope and the remaining 1P elsewhere. J.". sales grew annually by only
!.)P over the ne.t two years$ whereas 7uropean sales increased by an annual 1.8PC
making Levi's the brand leader in every national market in %ontinental 7urope. In 1++
nearly )*P of 1 to ,24year4old 7uropeans reportedly owned a pair of Levi's /#innie$
1++50 !,4!!6 -redre$ 1++a0 5). In 1++) Levi's had 11 7uropean factories /Leuters$
1++)a6 1loomberg 1++)).
Levi's 7uropean workforce was about e>ual to the number of employees being laid off in
the J.". Lestructuring of 7uropean operations as rumored$
/,*)

but no concrete plans were announced$ and workers pressuri=ed the company for a
7uropean4level consultation to clarify plans for the future /Itschert$ 1++80 ).
Asia.Pa&i'i&
Gim #raser$ the president of Levi "trauss (sia 3acific at that time $ believed that C%hina
could become the key manufacturing nation for the company's Gapanese and "outh
Horean markets$ which generated two4thirds of its D258 million in (sian revenueC
/Landler$ 1++80 1). -he company had a direct marketing operation in Iong Hong and
planned to open one on mainland %hina /Landler0 1). In late 1++) Levi's revealed that
production in &ew Kealand would come to a halt /2* jobs) after ,5 years //or$d
Reporter$ 1++)).
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LEVI STRAUSS & COMPANY
Beanwhile$ countries in the region e.periencing currency problems$ such as Indonesia
/where the local currency lost )P of its value during 1++))$ were also prime candidates
as sites for increased production for Levi's. Barimoetoe Banimaren$ president of
-e.maco @roup$ in Indonesia$ reported that his profit margin in garment production was
5 to 8 P but with the falling rupiah it was now up to 1* to 1, P. Ie told reporters that
Levi's %78 1ob Iaas visited his operations in (pril$ 1++8 and the company doubled
1++)'s order /3aul$ 1++80 2).
(Source: INTERNET)

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LEVI STRAUSS & COMPANY
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LEVI STRAUSS & COMPANY
Products and Marketing istor!
Levi "trauss < %o.'s core product line for men$ women and youth are the Levi's brand of
jeans and jean4related products. -he *1 brand$ established in 18+*$ and other jeans in
the *1 CfamilyC are the best4known.
/1)
*1s account for one third of Levi's J.". jean
sales$ according to one 1++) report /"herman0 )). 8ther jeans produced by Levi's
include0 Led -ab$ 8range -ab and "ilver -ab. -he new %apital 7 line came about when
Levi's became aware of a market for vintage jeans. -his classic model of the *14button
fly is produced on the original looms.
/,)
1etween 1++! and 1++ Levi's brand sales grew
+.,P annually /#innie$ 1++50 18). 3ersonal 3air jeans$ custom4made jeans for women$
were launched in 1++2. 1y 1++5 3ersonal 3air jeans reportedly accounted for ,P of all
women's jeans sold at Levi's stores in the J.". /%oolidge$ 1++50 +).
/!)

:ockers$ a line of casual cotton mens pants$ were launched in 1++!. "imultaneously
production overseas was e.panded /Battera0 21+) -his brand was Levi's entry into the
wrinkle4resistant clothing market$ increasingly a top4performing product among
consumers /especially in the J.".).
/2)
"ales were up and down between 1++! and 1++$
with a compounded annual rate of decline of 2.1P /#innie$ 1++50 1+). In late 1++5
though$ as the market leader$ annual sales for :ockers were approaching D1 billion
/"herman$ 1++)0 )).
In fall 1++5 Levi's introduced "lates$ a men's dress pants line$ slightly more
conservative than :ockers$ and Cthe third major brandC to be launched by the company
/L"<%8$ 1++5). ( D,* million marketing campaign accompanied the launch and within
four months "lates shot up to top seller in its category$ where it remained through 1++)
/L"<%8$ 1++56 @ebolys$ 1++)). "lates$ fashion4wise is positioned between :ockers
and tailored suits$ to cash in on the demand for more casual clothes for men over 2*.
Increasingly in the J.".$ and recently in 7urope$ corporate employees have the option of
dressing more casually one day per week.
/)
C:ress4down daysC /usually #ridays)
feature a rela.ed dress code where suits and ties are no longer mandatory$ but follow a
strict new CcasualC code. 1oth the :ockers and "lates brands cater to this market
demand.
1rittania$ a line of men's and women's jeans tops and casual sportswear$ purchased in
1+8)$ was Levi's main entry in the mass market. 1rittania was sold to the A#
%orporation for an undisclosed sum /Leuters$ 1++)). Bade and marketed under the
1rittania and 1rittgear labels$ this line was estimated to make up P of Levi's J.". unit
sales$ though this figure was reportedly dropping in 1++ when such information was
last available /#innie$ 1++50 ,*6 Battera$ 1++,0 2,*).
Led Line$ a new product described as Ca blend of traditional and contemporary4style
jeansC is set to be launched in fall 1++8 /3erman$ 1++)0 55).
In (pril 1++) Levi's announced plans to return to the footwear industry via a licensing
deal with the Le.ington$ Bassachusetts4based "tride Lite %orporation. -hough the
Page | 14
LEVI STRAUSS & COMPANY
terms of the agreement were not revealed$ the Levi's shoe line included dress$
sneakers$ shoes and hiking shoes and boots and were made available in department
and specialty outlets in the year 1++)/San -ran&is&o E#aminer$ 1++)).
Levi's post49orld 9ar II success was helped by an image associated with youthful
rebellion /(ctor Games :ean wore Levi's) and part of the anti4establishment ClookC
/(ctor Barlon 1rando wore jeans in the movie C-he 9ild 8neC)$ in the 1+5*s Levi's
jeans were part of the uniform associated with the si.ties generation /Battera$ 1++,0
218). C-hat was a gift from @od. It had absolutely nothing to do with our marketing
acumen$C e.plained "teve @oldstein$ vice president in charge of (merican brand
marketing at that time />uoted in "herman$ 1++)0 2).
/5)

&ow$ -he si.ties generation has grown up. (s a result the Levi's ClookC has come to be
indentified with the establishment in the J.".$ as jeans were considered the clothing of
middle4aged people$ parents. J.". teens describe Levi's jeans as Ctoo straight$C Cnot
baggy enoughC Ctoo plain$C and CpreppyC /Irvine$ 1++)). Levi's share of the men's jean
market dropped from 28P in 1++* to appro.. ,5P in late 1++). -his is probably
attributable to Levi's failure to accommodate J.". trends toward wide4leg$ baggy jeans
currently in fashion among young people. 9hile Levi's succeeded in spotting the trend
toward casual wear for aging C1aby 1oomers$C they failed to accurately gauge the taste
of their children and grandchildren. CIt's a fair assessment to say we were behind in
fashion$C admitted @ordon "hank$ president of Levi's$ the (mericas41++) />uoted in
3erman$ 1++)0 !). In response to declining market share at home$ new ad campaigns
target 124 to ,24year4olds$ according to "hank. "ays Iarry 1ernard$ a "an #rancisco
clothing4industry consultant0 CI think it's probably the most unfocused ad campaign that
they've ever had. I think they've lost track of who and what they areC />uoted in Irvine$
1++)).
/))
"hank noted that Levi's was now Cassessing every aspect of market mi. to
protect and maintain leadershipC />uoted in 3ermen0 !).
Leo Isotalo$ a former e.ecutive who ran several Levi's overseas operating groups until
1+8+$ said the company's success was also Cattributable to the ineffectiveness of their
branded competitionC />uoted in "herman$ 1++)0 2). In late 1++*s$ high4end designers$
such as :onna Haran$ -ommy Iilfiger$ Laph Lauren$ Aersace and %alvin Hlein$ now
have 24P of the men's jeans market$ while cheaper in4house brands /"ears $ G.%.
3enney and 9al4Bart$ for e.ample) have Cas much as 1+P of the men's market and
!*P of the women's$ compared with !P each in 1++*C /Ta&ti&a$ Retai$ Monitor$ cited in
Irvine$ 1++)). &ew companies$ such as Los (ngeles4based G&%8$ and :iesel$ based in
Bolvena$ Italy$ also offer competition$ having made inroads with wide4leg jeans and
marketing a Chip$ alternativeC image /3erman$ 1++)0,).
/8)
Levi's main competitor was A#
%orporation$ which produces the Lee and 9rangler brands.
/+)
-hough unit sales for the
A# products in the J.". are higher than for Levi's$ Levi's outsells them overseas$ where
the brand's standing as an (merican icon still has marketing clout. #inancial results for
Levi's in 1++ revealed a profit margin of over 2*P$ over 1*P more than A#'s
/"herman$ 1++)0 ).
Page | 15
LEVI STRAUSS & COMPANY
Barketing strategy focuses on seeking a more high4profile presence in the form of
bouti>ues located within department stores$ and an emphasis on the brand as the
strongest element /%oupland$ 1++)0 5). (ccording to Levi's0 C-o preserve and enhance
consumers' impressions of our brands$ the majority of our products will be sold through
dedicated distribution$ such as Levi'sT 8nly "tores and in4store shopsC /L"<%8$
1++8d). Levi's Cinitially planned to open some 18 8riginal Levi's stores around the
country$ but that strategy was dumped and the company then focused on ,8 high4
concept 'Jltrashops' in major marketsC /%oupland$ 1++)0 5). -he first Cultrashop$C
described as a Cstandout$C opened in the basement menswear department at the "an
#rancisco branch of Bacy's department store /%oupland0 5).
In 1++) the company operated 5) stores and a partner operated 1*.
/1*)
Levi's stores fit
into five categories0
4 8riginal Levi's "tores /!*)
4 :ockers 8utlets /,,)
4 Levi's 8utlets /1)
4 :ockers "hops /+)
4 3ersonal 3airs /1)
1ut$ in late 1++)$ the company announced plans to close 18 Levi's 8nly "tores. (ll the
:ockers "hops$ e.cept one$ to be close. -he 3ersonal 3airs store and several of the
8riginal Levi's stores were scheduled to close. CLevi's 8nly "tores as a company was
re4evaluating its concepts and strategies for 1++8$C spokeswoman Linda "mith /1++8)
told a reporter. CIn the ne.t few months$ we will decide what the goals will be moving
forward. 9e've got to close stores to stay profitable and we've got to open other stores
to be profitableC />uoted in @ebolys$ 1++)). Later$ Levi's focused on its four Coversi=ed
flagship stores in &ew 'ork$ %hicago$ "eattle and 3ortland$ 8re.$ and adding outlet mall
stores. #our or more were planned in 1++8C /@ebolys$ 1++)).
1997 Sales Figures
Levi Strauss, the Americas
(includes North & South American
operations)
$!" #illion
Levi Strauss Europe $$!% #illion
Levi Strauss Asia & 'aci(ic $"% million
(source: Levi Strauss & Co., 1998b)
(Soure! I"#er"a#$o"a% &oru' o" %ea" %o#(e)* a)e &$%e o" LEVI STRAUSS +,-.)
Page | 16
LEVI STRAUSS & COMPANY

So'e -u# o& 'a"/ Le0$1) 2e)$g"er )er$e)

Page | 17
LEVI STRAUSS & COMPANY
MA"OR #RAN$S INTRO$UCE$
18)!0 LeviOs$ companyOs main brand introduced including world famous *1s.
1+5*s0 beige twill introduced.
1+510 corduroy jeans introduced.
1+520 stretch jeans and "ta43restQ slacks introduced.
1+580 womenOs wear introduced.
1+820 official outfitters of J.". 9inter and "ummer 8lympic teams$ and Los
(ngeles 8lympic @ames staff.
1+850 casual :ockers line of pants introduced.
1++50 "lates dress slacks first marketed.
1++80 8riginal "pin$ custom jeans program$ initiated.
,***0 jeans and jackets with Cwearable electronicsC marketed in 7urope.
,**!0 Levi "trauss M"ignatureN brand introduced.


Page | 18
LEVI STRAUSS & COMPANY
STRATE%Y TO TAC&LE COMPETITION
Levi "trauss has seen its J.". sales plummet from a peak of D).1 billion in 1++5 to
about D2 billion in ,**!$ in part because of fierce competition. Its jeans brands$
e.emplified by the classic *1$ are being hit from all sides0 above$ from trendy$ high end
designer lines such as %alvin Hlein$ -ommy Iilfiger$ n @(36 below$ from popular$ low4
priced private labels like G% 3enneyOs (ri=ona n "earsO %anyon Liver 1lues 6 from one
side by traditional$ entrenched brands such as the 9estern 9ranglers n Jrban LeeOs6 n
from another other side by hip$ youthful lines such as (merican 7agle$ 1ugle 1oy$
G&%8$ Lucky n :iesel.
LeviOs being hit from so many directions$ it is hard for the company to know in which
direction to turnR -o better compete$ it introduced the M"ignatureN Line to be sold at
discount stores such as 9al4Bart n the more e.pensive M3remium Led -abN Line to be
sold at upscale department stores such as &ordstrom n &eiman Barcus. Bany
marketing pundits wondered$ whether it was too little too late$ n if the brand could ever
reclaim its lofty position. In India$ however LeviOs is on the upswing$ having retained its
U1 position as the most admired jeans wear brand at Lycra Images #ashion (wards
,**5.
(SOURCE: INTERNET)

Page | 19
LEVI STRAUSS & COMPANY
BUSINESS STRTE!IES "#$$%&
1. Innovate and lead from the core
2. Enhance brand preence
thro!"h e#ect$ve mar%et$n"
&. 'oter tron" reta$l relat$onh$p
(. Sell )here people hop
*. +ch$eve operat$onal e,cellence
-. Enhance .nanc$al
/.tren"th and 0e,$b$l$t1

Page | 20
LEVI STRAUSS & COMPANY
(Soure! A33UAL REP-RT-2005 -4 LEVI STRAUSSS + ,-.)
ANALYSIS '())*+
Le*is 'o&)sed on 'i*e ey priorities in 0112" T!e 'irst %as to impro*e t!e &ompany3s
pro'itabi$ity and de$i*er its 'inan&ia$
p$an" Company made good progress on t!is 'ront4 de$i*ering a 5006 mi$$ion
impro*ement in operating in&ome and a 5708 mi$$ion
In&rease in net in&ome" T!e signi'i&ant portion o' t!ese gains &ame 'rom &ompany3s
in&reased gross margin res)$ting 'rom se$$ing more
Premi)m prod)&ts and $o%ering &ost o' goods" Additiona$$y4 it s)&&ess')$$y re'inan&ed
essentia$$y a$$ o' near9term bond
Mat)rities4 e#tending t!em to 0170 and beyond and enab$ing itse$' to $o%er t!e interest
e#pense" Le*is a$so &$osed 7: open U"S" ta#
years ;7<68 9 7<<<= in 0112" T!is %as a tremendo)s a&&omp$is!ment and ga*e t!e
&ompany a more typi&a$ ta# a)dit pro'i$e"
A$t!o)g! net sa$es gre% s$ig!t$y in 01124&ompany !ad !oped 'or stronger sa$es in t!e
se&ond !a$' o' t!e year" >ig! s)mmer and 'a$$
')e$ pri&es4 &ombined %it! $o% o*era$$ &ons)mer &on'iden&e4 !it t!e &ore &!anne$s o'
distrib)tion !ard4 espe&ia$$y in t!e U"S" *a$)e
&!anne$" Company a$so e#perien&ed disappointing sa$es res)$ts in E)rope4 t!o)g! t!e
region s)bstantia$$y impro*ed its pro'itabi$ity"
In addition to managing in a *ery to)g! E)ropean e&onomi& and retai$ en*ironment4
$eaders in t!e region identi'ied operationa$
iss)es in many marets t!at pre&$)ded t!em 'rom ')$$y imp$ementing b)siness
strategies" ?i*en t!e s)&&ess mig!t3*e seen in
ot!er parts o' t!e %or$d %!en t!e strategies are ')$$y e#e&)ted4 Le*is remain &on'ident
t!at it is on t!e rig!t strategi& &o)rse
in E)rope" In No*ember4 &ompany rea$igned its E)ropean management str)&t)re to
'o&)s $eaders!ip on &riti&a$ aspe&ts o' e#e&)tion
in t!e region" Impro*ing its per'orman&e in E)rope is a ey priority 'or t!e &ompany4 and
t!e top $e*e$ !ad e*ery &on'iden&e t!at t!eir
E)ropean management team %i$$ t)rn t!e b)siness aro)nd"
Company3s se&ond priority %as to gro% t!e Le*i3s@ and Le*i Stra)ss Signat)re@
brands %or$d%ide" Aot! brands gre% in 0112 on a
g$oba$ basis" Le*is e#perien&ed parti&)$ar$y strong Le*i3s@ gro%t! in Asia Pa&i'i&4 %it!
many ey marets registering do)b$e9digit
re*en)e in&reases" In t!e United States4 Le*i3s@ brand net sa$es %ere stab$e 'or t!e 'irst
time in nine years4 bene'iting 'rom ne%
prod)&ts t!at $ed t!e maret4 in&$)ding men3s $o% boot &)t Beans and %omen3s Cs$o)&!D
sty$es4 and Company3s strong CA Sty$e 'or E*ery
StoryED mareting &ampaign" /!en Le*is $oos at U"S" Le*i3s@ brand sa$es on a
&omparab$e basis4 meas)ring sa$es 'or t!e prod)&t
&ategories it &ontin)ed to design and se$$ in 0112 *ers)s sa$es 'or t!ose same
&ategories in 011:4 t!e U"S" Le*i3s@ brand gre%
Page | 21
LEVI STRAUSS & COMPANY
t!ree per&ent 'or t!e year" T!ese impro*ed res)$ts %ere !e$ped by t!e per'orman&e o'
&ompany9operated stores4 %!i&! !a*e
generated &omparab$e9store sa$es gro%t! 'or t!ree &onse&)ti*e years" Le*i3s gro%ing
net%or o' &ompany9operated stores is an
in&reasing$y important %ay to rea&! &ons)mers in ey marets and demonstrate to
Le*i3s %!o$esa$e &)stomers t!e most e''e&ti*e
te&!ni,)es 'or mer&!andising its prod)&ts"
Sin&e its $a)n&! in 011F4 t!e Le*i Stra)ss Signat)re@ brand !as e#panded to 70
&o)ntries %or$d%ide" T!e brand3s gro%t! in
0112 %as dri*en by its strong per'orman&e in t!e United States4 t!o)g! sa$es s$o%ed
&onsiderab$y in t!e $atter part o' t!e year
as b)dget9&onstrained U"S" *a$)e &ons)mers p)$$ed ba& on appare$ spending"
Nonet!e$ess4 t!e mass &!anne$ &ontin)es to gro%
and t!e Le*i Stra)ss Signat)re@ brand !as be&ome an important part o' Le*i Stra)ss &
Co"3s tota$ b)siness"Company3s &onsiderab$e
resear&! s!o%s t!at t!e brand is &ontrib)ting in&rementa$ re*en)es and pro'its 'or t!e
&ompany %it!o)t any signi'i&ant &ons)mer
&anniba$i(ation o' Le*i3s@ Red TabE b)siness4 demonstrating t!at t!e Le*i Stra)ss
Signat)re@ brand ser*es a distin&t &ons)mer need in t!e maretp$a&e"
Le*is a$so 'o&)sed on re*ita$i(ing t!e +o&ers@ brand %or$d%ide and made signi'i&ant
strides on t!is priority" It p)t ne% brand $eaders!ip in p$a&e in t!e United
States4 E)rope and Asia Pa&i'i&" Company imp$emented more e''i&ient operating
mode$s in
E)rope and Asia designed to $e*erage t!e brand3s s)bstantia$ U"S" prod)&t
de*e$opment
and mareting &apabi$ities on a g$oba$ basis" T!is past 'a$$4 t!e +o&ers@ brand
%or$d%ide )nited be!ind a ne% mareting and branding p$at'orm &a$$ed C+o&ers@
San -ran&is&o"D T!e &ampaign $ins t!e brand to its !ometo%n roots and positions
its mareting programs )nder one )mbre$$a 'or bot! men and %omen" Cons)mers
!a*e rea&ted positi*e$y to t!is ne% approa&!"
T!e U"S" +o&ers@ men3s b)siness G Company3s $argest +o&ers@ segment in t!e
%or$d
G ret)rned to gro%t! in 01124 be!ind t!e s)&&ess o' premi)m prod)&ts4 s)&! as t!e
Ne*er9IronE Cotton H!ai4 a 711 per&ent &otton pant t!at &omes o)t o' t!e dryer
%it! a dry9&$eaned $oo and permanent &rease" T!e U"S" +o&ers@ b)siness 'inis!ed
t!e year strong %it! sa$es )p nine per&ent in t!e 'o)rt! ,)arter" Company !ad more
%or
to do to stabi$i(e its U"S" %omen3s b)siness and b)i$d moment)m 'or t!e entire
brand o)tside t!e United States" Sti$$4 Company %as &on'ident t!at t!e brand is no% on
its %ay
to%ard pro'itab$e gro%t! in t!e United States and is $aying a 'o)ndation 'or ')t)re
gro%t! in E)rope and Asia"
0112 %as a year in %!i&! Le*is &ontin)ed to b)i$d on t!e operationa$ impro*ements
and &ost red)&tions o' t!e past 'e% years" A'ter e#perien&ing s)pp$y &!ain
prob$ems t!at res)$ted in )nder ser*i&ing &ons)mer demand in 011:4 &ompany %ent to
%or to impro*e s)pp$y &!ain p$anning and operationa$ e''e&ti*eness" It &reated
Page | 22
LEVI STRAUSS & COMPANY
a g$oba$ so)r&ing organi(ation based in its Asia Pa&i'i& !ead,)arters in Singapore"
T!e res)$t %as impro*ed retai$ &)stomer ')$'i$$ment rates in 0112"
Company3s &ontin)ed 'o&)s on &ost9o'9goods sa*ings and tig!t$y &ontro$$ing t!e sa$es
a$$o%an&es
and in&enti*es t!at di$)te its margins !e$ped de$i*er a *ery strong :8 per&ent
gross margin rate in 0112" Company &ontin)ed impro*ing its 'inan&ia$ &ontro$s and
monitoring rigor in 01124 preparing t!e &ompany to meet its SOI :1: re,)irements
in 011J"
One o' t!e eys to Le*is ')t)re s)&&ess is ens)ring t!at it &ontin)o)s$y in*est in its
Emp$oys34 &apabi$ities and si$$s" Le*is !as s)bstantia$$y in&reased its in*estment in
training 'or better operationa$ e''e&ti*eness" T!ro)g!o)t 01124 &ompany added ne%
$eaders!ip
ta$ent in ey positions aro)nd t!e %or$d4 in&$)ding ne% !ires and promotions a&ross
E)rope aimed at stabi$i(ing t!at b)siness"
(Soure! LS + ,-. A""ua% Re5or# 2005)


Page | 23
LEVI STRAUSS & COMPANY
#usiness Trans ,or-ation '())*+
0112 %as a mi$estone year in Le*i Stra)ss & Co"3s t)rnaro)nd %or" Company3s
impro*ed per'orman&e is t!e &)$mination o' a series o' &ommer&ia$ and organi(ationa$
a&tions &ompany !a*e
e#e&)ted d)ring t!e $ast 'i*e years t!at !a*e trans'ormed its b)siness and addressed
t!e trends and &!anging dynami&s o' t!e g$oba$ appare$ maretp$a&e" T!ese a&tions
in&$)deK
./ Strengt0ening its -anage-ent tea-1 rationa2i3ing and re4a-5ing its core
5roduct 2ines1 and i-5ro4ing its s5eed to -arket and res5onsi4eness to
consu-er 5re,erences
(/ I-5ro4ing t0e econo-ics ,or Le4i6s7 and $ockers7 retai2ers1 2aunc0ing
t0e Le4i Strauss Signature7 8rand ,or 4a2ue9conscious consu-ers in Nort0
A-erica: Euro5e and Asia1 acce2erating its gro;t0 in Asia1 and e<5anding
2icensing acti4ities
=/ En0ancing its g2o8a2 sourcing and 5roduct inno4ation ca5a8i2ities: and
reducing its cost o, goods and re2ated o5erating e<5enses 8! increasing
outsourced contract 5roduction and strea-2ining t0e organi3ation
>/ u I-52e-enting a ne; 8usiness 52anning and 5er,or-ance -ode2 t0at
c2ari?es
ro2es: res5onsi8i2ities and accounta8i2ities and i-5ro4es o5erationa2
e@ecti4eness
As a res)$t o' t!ese and ot!er initiati*es4 Le*is !a*e s)bstantia$$y impro*ed its 'inan&ia$
Strengt!" +)ring t!e period 'rom 0110 t!ro)g! 01124 &ompany3s operating margin
impro*ed 'rom 8"7 per&ent to 7:"F per&ent and t!e gross margin rate impro*ed 'rom
:1"6
per&ent to :2"6 per&ent" Its operating in&ome in&reased 'rom 502:"7 mi$$ion to 526<"F
mi$$ion and net in&ome !as &$imbed 'rom 5J"F mi$$ion to 5722"< mi$$ion" In t!e pro&ess4
&ompany
!a*e a$so impro*ed its $i,)idity and &redit ratings"
"Source: INTERNET&


Page | 24
LEVI STRAUSS & COMPANY
ANALYSIS '())A+
T!e 'o)rt!9,)arter per'orman&e %as en&o)raging" Sa$es and pro'its %ere
)p &ompared to t!e same period $ast year4 and Company generated positi*e
res)$ts in t!e b)siness" T!e U"S" Le*i3s@ and +o&ers@ brands
bot! posted re*en)e gro%t!4 res)$ting in 'o)r per&ent gro%t! 'or t!e Nort!
Ameri&an region" T!e Asia Pa&i'i& b)siness a$so reported a si# per&ent net
re*en)e in&rease4 %!i$e E)rope3s re*en)e trend impro*ed s)bstantia$$y"
-or t!e ')$$ year &ompany %ide4 Le*is de$i*ered stab$e sa$es and strong pro'its4
and paid do%n debt" Company3s priority in 0118 %as to impro*e pro'itabi$ity and
&as! '$o% in order to red)&e debt" T!e net in&ome 'or 0118 in&reased 2F
per&ent &ompared to t!e prior year" Company s)bstantia$$y impro*ed its &as!
'$o% and ended t!e year %it! net debt at 57"< bi$$ion4 do%n 57:6 mi$$ion
'rom t!e beginning o' t!e year"
Le*is began 0118 addressing maBor &!a$$enges" Its b)siness in E)rope %as in
steep de&$ine4 and Company anti&ipated a signi'i&ant impa&t 'rom retai$ mergers and
&onso$idation in t!e United States" T!e b)siness )nits aggressi*e$y &on'ronted
t!e iss)es" As a res)$t4 t!e impa&t o' U"S" retai$ &onso$idation %as m)&! $ess
t!an it origina$$y anti&ipated4 a$t!o)g! t!e iss)e &ontin)es to be a &on&ern
mo*ing 'or%ard" Additiona$$y4 t!e &orre&ti*e a&tions Company too in E)rope !a*e
beg)n to stabi$i(e t!at b)siness4 %!i&! mo*ed 'rom do)b$e9digit net re*en)e
de&$ines in t!e 'irst t%o ,)arters o' 0118 to a t!ree per&ent reported in&rease
'or t!e 'o)rt! ,)arter"
In t!e United States4 t!e +o&ers@ brand !as gro%n 'or 'i*e &onse&)ti*e
,)arters" T!e U"S" Le*i3s@ brand4 Le*i3s $argest b)siness )nit4 b)i$t on its stabi$ity
in 0112 %it! gro%t! in 0118" T!is is an important be$$%et!er o' LS&CO"3s
in&reasing strengt!" T!e Asia Pa&i'i& b)siness4 %!i&! str)gg$ed %it! in*entory
iss)es in Lapan t!at &a)sed an )n&!ara&teristi& re*en)e de&$ine in t!e t!ird
,)arter4 %as ba& to re*en)e gro%t! in t!e 'o)rt! ,)arter and de$i*ered
gro%t! 'or t!e ')$$ year"
In 01184 inno*ati*e prod)&ts %ere introd)&ed " In t!e United States and E)rope4 ne%
s$im9 and sinny9'it Le*i3s@ Beans !e$ped dri*e impro*ed per'orman&e
'or t!e brand" In Asia4 t!e dressier Le*i3s@ Lady Sty$e range and ne%
assortments o' Le*i3s@ Engineered Leans@ resonated %it! &ons)mers"
T!e 'a$$ $a)n&! o' t!e Le*i3s@ e&o organi& Beans range in t!e United States
and E)rope ')rt!er demonstrated Le*i3s inno*ation $eaders!ip"
T!e +o&ers@ brand enBoyed a *ery good year dri*en by a !ost o' ne%
prod)&ts4 in&$)ding t!e Iron9-ree Cotton H!ai and t!e Ne*er9IronE
%as!ab$e %oo$ pant" T!ese prod)&ts4 a$ong %it! t!e a$ready s)&&ess')$
Page | 25
LEVI STRAUSS & COMPANY
Premi)m Ne*er9IronE Cotton H!ai4 made t!e +o&ers@ brand t!e n)mber
one iron9'ree pants &!oi&e 'or men in t!e United States" Additiona$$y4
t!e +o&ers@ %omen3s range made a strong &omeba& in 0118 %it! t!e
$a)n&! o' a range o' ne% 'its4 s)&! as t!e Metro pant4 and a ')$$ &o$$e&tion
o' integrated tops and a&&essories"
T!e Le*i Stra)ss Signat)re@ brand4 %!i&! is Le*i3s prod)&t o''ering to
*a$)e9&ons&io)s &ons)mers %!o s!op in t!e mass &!anne$4 'a&ed
signi'i&ant &!a$$enges in t!e United States and E)rope in 0118 b)t t!e brand steadi$y
progressed in Asia Pa&i'i& and made strong operating pro'it in t!e United States"
CLe*is maret its brands in more t!an 771 &o)ntries %or$d%ide" Mo*ing
'or%ard4 Le*is %i$$ &ontin)e to &apita$i(e on its g$oba$ s&a$e G adopting4
adapting and s!aring t!e best prod)&ts4 programs and operationa$
pra&ti&es a&ross t!e enterprise" T!is approa&! enab$es Le*is to meet maret
needs 'aster and more e''i&ient$y4 $o%ering &osts and dri*ing gro%t!D9 Mr" Lo!n
Anderson4 President and C!ie' E#e&)ti*e O''i&er"
Prod)&ti*ity impro*ement &ontin)es to be a priority in 011J 'or Le*is" T!is
in&$)des optimi(ing its g$oba$ so)r&ing organi(ation %it! t!e goa$ o'
$o%ering tota$ $anded &osts" Company p$an to in*est t!ese sa*ings ba&
into t!e b)siness to b)i$d its brands4 as %e$$ as to pay do%n debt"
Le*is &annot ')$$y $e*erage its strengt!s aro)nd t!e %or$d and e$iminate
)nprod)&ti*e %or %it!o)t impro*ed systems" Le*is is in t!e pro&ess o'
imp$ementing an SAP so$)tion to impro*e its operationa$ and 'inan&ia$
res)$ts" Le*is did t!is s)&&ess')$$y in Asia in 01184 and are no% beginning
to ro$$ o)t SAP in t!e United States"
In re&ent years4 Le*is !a*e gro%n its dedi&ated retai$ stores net%or and
ot!er retai$ Cs!op9in9s!opD 'ormats" T!ese &ompany9operated retai$
presentations 'i$$ C%!ite spa&eD in t!e maretp$a&e and mae its prod)&t
ranges a&&essib$e to more &ons)mers" T!e stores a$so gi*e t!e &ompany an
opport)nity to e#p$ore impro*ed %ays to mer&!andise and assort its prod)&t
ranges G no%$edge and te&!ni,)es t!at t!e &ompany s!are %it! its %!o$esa$e
&)stomers" Company p$an to &ontin)e to gro% its retai$ store net%or in 011J4
%!i$e remaining 'o&)sed on b)i$ding its %!o$esa$e b)siness4 %!i&!
represents t!e *ast maBority o' its tota$ sa$es"
Le*is is &ommitted to eep itse$' a$%ays on top on g$oba$ maret" -or t!e p)rpose4 Le*is
!as deri*ed somet!ing important" T!is in&$)des s)stained4 pro'itab$e gro%t!" /it! t!e
!e$p o' t!e ta$ented $eaders t!ro)g!o)t t!e &ompany"
C/e %i$$ a&&omp$is! o)r goa$s t!e LS&CO" /ay G %it! passion and a&&o)ntabi$ity4 and
in a manner t!at is &onsistent %it! t!e &ompany3s *a$)es and $ongstanding tradition
o' &orporate &iti(ens!ip"D
9 Mr" Lo!n Anderson4 President and CEO9 LEVI STRAUSS & CO"
Page | 26
LEVI STRAUSS & COMPANY
COMPARIN% FINANCIAL FI%URES
'())(9())A+


Page | 27
LEVI STRAUSS & COMPANY
(Source: LS & CO. Annual Report 2006)
STRATE%Y '())B9)C+
1.2$n )$th 3rod!ct.
2.+dopt +dapt and Invent to "ro).
&.Sell )here people Shop.
4. Enable "ro)th and prod!ct$v$t1 )$th S1tem.

Page | 28
LEVI STRAUSS & COMPANY
ANALYSIS '())B+
In 011J4 Le*is generated ')$$9year re*en)e and pro'it gro%t!4 a$t!o)g! t!e
se&ond !a$' o' t!e year pro*ed more &!a$$enging %it! maretp$a&e &onditions
%eaening in t!e United States and ey mat)re marets in Asia as t!e year
)n'o$ded"
T!e net re*en)es 'or t!e 'is&a$ year gre% : per&ent4 !e$ped s)bstantia$$y by
stronger 'oreign &)rren&ies" Le*is de$i*ered more in&ome as a res)$t o'
its 'o&)s on $o%ering debt and interest e#pense" In&ome be'ore in&ome
ta# in&reased < per&ent to 5FJ8 mi$$ion &ompared to 'is&a$ 0118" Net
in&ome impro*ed by <F per&ent to 5:81 mi$$ion4 s)bstantia$$y dri*en by a
5072 mi$$ion ta# bene'it t!at res)$ted in part 'rom Company3s impro*ed b)siness
per'orman&e" -or t!e year4 Company paid do%n more t!an 5021 mi$$ion o' debt"
Its tota$ debt !as no% 'a$$en to 57"<8 bi$$ion4 t!e $o%est $e*e$ in more t!an
a de&ade"
T!e t!ree agen&ies t!at rate &ompany3s debt re&ogni(ed it3s impro*ed 'inan&ia$
strengt!" In A)g)st 011J4 Moody3s In*estors Ser*i&e4 Standard & Poor3s and -it&!
Ratings a$$ )pgraded debt ratings or ratings o)t$oo" T!is !ea$t!ier
'inan&ia$ Cs&ore&ardD !e$ped se&)re $o%er interest rates %!en re'inan&ed
Company3s !ig!9interest 70"02 per&ent bonds4 sa*ing t!e &ompany mi$$ions o'
do$$ars ann)a$$y"
Le*is made signi'i&ant strides in 011J to strengt!en ea&! o' its t!ree
regiona$ b)sinesses" E)rope %as a stando)t per'ormer4 ending t!e year
%it! a so$id 7F per&ent net re*en)e in&rease t!at a$so in&$)ded t!e bene'it
o' 'oreign &)rren&y e#&!ange rates" T!e region bo)n&ed ba& 'rom a
to)g! year in 0118 by s)&&ess')$$y repositioning t!e Le*i3s@ brand in t!e
premi)m segment o' t!e maret and )pgrading its retai$ net%or" Asia
Pa&i'i& 'a&ed se*era$ &!a$$enges in its $argest mat)re marets G Lapan and
Horea G in&$)ding signi'i&ant e#&ess in*entory" Le*is p)t ne% $eaders!ip in
p$a&e in Lapan4 and &ontin)ed to 'o&)s on t!e iss)es press)ring its mat)re
marets" T!e region gre% again in 011J4 !e$ped s)bstantia$$y by t!e rapid
gro%t! o' emerging marets s)&! as C!ina and India"
In Nort! Ameri&a4 t!e Le*i3s@ brand gre% again 'or t!e se&ond &onse&)ti*e
year" T!e +o&ers@ b)siness a$so gre% s$ig!t$y 'or t!e year4 a$t!o)g! t!e
%eaening U"S" retai$ en*ironment s$o%ed t!e brand3s per'orman&e in t!e
se&ond !a$' o' t!e year" T!e Signat)re by Le*i Stra)ss & Co"E brand !ad
a di''i&)$t year4 as e#pe&ted" T!e brand is being o*er!a)$ed to a$ign %it!
Company3s mass retai$ &)stomers3 e*o$*ing appare$ mer&!andising strategies"
Page | 29
LEVI STRAUSS & COMPANY
Win with Product, Product, Product
T!e &ompany3s most signi'i&ant a&!ie*ement 'or 011J is t!e %or$d%ide gro%t!
o' t!e Le*i3s@ brand" It is Le*i3s $argest b)siness and an important indi&ator o' its
progress" Le*i3s CEO3s ans%er to C%!at !as dri*en t!e res)rgen&e o' t!e Le*i3s@
brandMD Is Cprod)&t4 prod)&t and more prod)&t"D
Among a$$ t!e initiati*es t!at &ompany is p)rs)ing to strengt!en t!e &ompany4 &reating
great prod)&ts is t!e most &riti&a$ to its s)&&ess" In 011J4 Le*i3s teams aro)nd t!e %or$d
%ored re$ent$ess$y to )pgrade and e#tend its prod)&t ranges4 maing its assortments
more premi)m4 inno*ati*e and sty$is!" T!eir e''orts are paying o''"
T!e Le*i3s@ brand estab$is!ed itse$' as a $eader in s$im9 and sinny9'it Beans
aro)nd t!e %or$d" T!e brand a$so strengt!ened its presen&e in t!e premi)m
and s)per9premi)m Beans &ategories" In Nort! Ameri&a4 t!e Le*i3s@ Capita$
EE range made a 'ormidab$e &ompetitor in t!e s)per9premi)m Beans
&ategory at )ps&a$e retai$ers" In E)rope4 t!e s)per9premi)m A$)e range !e$ped
to reestab$is! t!e brand3s &redibi$ity as a premi)m Beans p)r*eyor a&ross t!e
region" Asia Pa&i'i&4 %!ere most o' t!e Le*i3s@ range &ompetes in t!e premi)m
and s)per9premi)m &ategories4 ')rt!er &emented its )ps&a$e position by ro$$ing
o)t inno*ati*e4 !ig!9end ne% &o$$e&tions4 s)&! as Le*i3s@ CopperE4 Le*i3s@ Lady
Sty$eE and Le*i3s@ Red $oop"
T!e +o&ers@ brand3s impro*ed sa$es in 011J a$so re'$e&t its )pgraded prod)&t
range %or$d%ide" T!e men3s b)siness in Nort! Ameri&a &ontin)ed to b)i$d on
its 'o)r %earing o&&asions strategy G %or4 dress4 %eeend and go$' G o''ering
&ons)mer9re$e*ant4 !ead9to9toe $i'esty$e prod)&ts %it! ')n&tiona$ bene'its4
s)&! as Iron -ree Cotton H!ai pants and Iron -ree s!irts" A)t t!e big story 'or
t!e brand %as t!e strong res)rgen&e o' t!e %omen3s b)siness in Nort! Ameri&a"
A &omp$ete$y ne% prod)&t range G in&$)ding a re*ita$i(ed &ore o''ering G and
a &onstant r!yt!m o' on9trend seasona$ 'as!ion prod)&ts res)$ted in !ea$t!y
do)b$e9digit sa$es in&reases 'or t!e +o&ers@ %omen3s b)siness"
Adopt, Adapt, Invent To Grow
One o' Le*i3s &ompetiti*e ad*antages is its g$oba$ 'ootprint" Company se$$s its
prod)&ts in more t!an 771 &o)ntries" In 011J4 it p)t pro&esses and
peop$e in p$a&e to enab$e itse$' to better $e*erage its tremendo)s s&a$e"
Its Cadopt4 adapt4 in*entD p!i$osop!y en&o)rages teams to s!are t!eir
best ideas4 prod)&ts and pra&ti&es a&ross t!e &ompany" T!e +o&ers@
brand is a great e#amp$e o' t!is" A$t!o)g! sti$$ a re$ati*e$y sma$$ brand
o)tside o' t!e United States4 +o&ers@ teams aro)nd t!e %or$d !a*e &ome
toget!er )nder a &onsistent $i'esty$e positioning G +o&ers@ San -ran&is&o"
Operating 'rom t!is &ommon p$at'orm4 t!e teams are systemati&a$$y
s!aring prod)&t ideas4 mer&!andising &on&epts and mareting programs4
$e*eraging t!e *ery best 'rom ea&! region" T!is approa&! assists t!e &ompany tae ')$$
ad*antage o' its s&a$e and ta$ented peop$e in e*ery region o' t!e %or$d"
Page | 30
LEVI STRAUSS & COMPANY
Le*is is embedding its Cadopt4 adopt4 in*entD approa&! a&ross its brands
and b)sinesses" T!e res)$t is greater speed to maret4 &onsisten&y and
e''i&ien&y %or$d%ide"
Sell Where People Shop
CMaing great prod)&ts doesn3t matter i' yo) &an3t get t!em in 'ront o' t!e
rig!t &ons)mersD"
G Mr" Lo!n Anderson4 CEO and President4 Le*i Stra)ss & CO"
T!ro)g!o)t 011J4 Le*is in*ested &onsiderab$y in e#panding and impro*ing t!e
a*ai$abi$ity o' its prod)&ts" Company added ne% branded retai$ stores G bot! &ompany9
operated and 'ran&!ised G and 'o&)sed on b)i$ding its b)siness %it! its traditiona$ retai$
&)stomers" Le*is re&ogni(ed t!at se$$ing in bot! traditiona$ retai$ stores and its o%n
branded stores is essentia$ to gro% t!e &ompany"
In t!e United States4 Company &reated separate %!o$esa$e and retai$ di*isions 'or
t!e Le*i3s@ brand4 ea&! %it! t!eir o%n $eaders!ip and teams dedi&ated to
b)i$ding t!ese distin&t b)sinesses" Aot! di*isions &ontrib)ted to t!e brand3s
gro%t! in 011J" Company a$so opened its 'irst &ompany9operated +o&ers@
Stores in t!e United States4 gi*ing t!e brand a *en)e to mer&!andise t!e
breadt! o' its $i'esty$e o''ering 'or men and %omen"
In E)rope4 Le*is )pgraded and e#panded its Le*i3s@ 'ran&!ise retai$ net%or
a&ross t!e region to better re'$e&t t!e brand3s premi)m positioning" T!is
impro*ed retai$ presen&e %as a ey to t!e region3s s)bstantia$$y impro*ed
res)$ts in 011J" Asia Pa&i'i& a$so !as e#panded its retai$ net%or4 in&$)ding
opening branded Le*i3s@ and +o&ers@ -$ags!ip stores in ey &ons)mer
marets t!ro)g!o)t t!e region"
/or$d%ide4 Le*is !as more t!an 74211 brand9dedi&ated stores4
in&$)ding more t!an 74F11 'ran&!ised stores and appro#imate$y 011
&ompany9operated stores"
Enable Growth and Productivity with Systes
Le*is &ontin)es to )pgrade its g$oba$ systems to mae t!e &ompany more
prod)&ti*e4 e$iminate )nne&essary %or and red)&e &omp$e#ity" Company
imp$emented SAP in 70 &o)ntries a&ross Asia Pa&i'i& and made it Cgo $i*eD in t!e
United States by t!e end o' t!e 'irst ,)arter o' 'is&a$ 0116" E)rope %i$$ 'o$$o%
in 011<" In addition4 &ompany ro$$ed o)t ne% retai$ systems in its o%n store
net%or"
Ne% te&!no$ogy a$so !e$ps Le*i3s emp$oyees s!are in'ormation and %or more
&o$$aborati*e$y aro)nd t!e %or$d" In 011J4 Company introd)&ed a ne% g$oba$ porta$
p$at'orm t!at ga*e emp$oyees a strategi& &omm)ni&ations too$4 enab$ing
t!em to &o$$aborate a&ross teams4 regions and t!e %or$d" T!is approa&! 'osters
inno*ation4 and in&reases prod)&ti*ity and speed to maret"
Le*i3s per'orman&e in 011J demonstrates t!at it is on t!e rig!t strategi& pat!" Its 'o&)s
no% is on e#e&)ting its p$ans %it! e#&e$$en&e"
Page | 31
LEVI STRAUSS & COMPANY
COMPARIN% FINANCIAL FI%URES
'())A9())B+
NET REVENUE
2006 - $ 4.193 billion
2007 - $ 4.361 billion
NET INCOME
2006 - $ 239 million
2007 - $ 460 million
TOTAL DET
2006 - $ 2.217 billion
2007 - $ 1.960 billion
(Soure! LS + ,-. A""ua% Re5or# 2007)

Page | 32
LEVI STRAUSS & COMPANY
Cor'orate Strategies "#$$()$*&
1. U!"#$%in" &#o%'().
2. E*!$n%in" Di+)#ib')ion.
3. C$!i)$li,in" on "lob$l -oo)!#in).
4. M$.in" o!/#$)ion+ mo#/
/0(i/n).


Page | 33
LEVI STRAUSS & COMPANY
(Soure! I3TER3ET)

ANALYSIS '())C+
FIRST DUARTER
Net Revenues Up 4% in the First uarter! F"at in Constant Curren#$
Net %n#ome %n#reases &'%
(oar) *e#"ares +,- .i""ion Cash *ivi)en) to Common Shareho")ers
SAN -RANCISCO ;Apri$ 64 0116= G Le*i Stra)ss & Co" ;LS&CO"= anno)n&ed 'inan&ia$
res)$ts 'or t!e 'irst ,)arter ended -ebr)ary 0:4 0116 and 'i$ed its
'irst ,)arter 0116 res)$ts on -orm 719N %it! t!e Se&)rities and E#&!ange Commission"
>ig!$ig!ts in&$)deK
T0ree Mont0s Ended E
Increase
'$ecreas
e+
'F
-i22ions+
+e,ruary #-.
#$$(
+e,ruary #%.
#$$/
s
Re'orted
Net
re4enues
01.$(2 01.$2/ -3
Net
inco-e
0*/ 0(/ 1#3
T!e in&rease in net re*en)es primari$y re'$e&ted t!e impa&ts o' 'oreign &)rren&y
e#&!ange" On a &onstant &)rren&y basis4 net re*en)es %ere essentia$$y )n&!anged
'rom $ast year3s 'irst ,)arter" T!e &ompany &ontin)ed to generate sa$es gro%t!
Page | 34
LEVI STRAUSS & COMPANY
in E)rope and its emerging marets in Asia Pa&i'i&" T!ese gains %ere $arge$y
o''set by re*en)e de&$ines in t!e Ameri&as region and in &ertain mat)re marets
in Asia" T!e res)$ts 'or t!e ,)arter a$so re'$e&ted 576 mi$$ion o' ad*an&e
s!ipments in t!e United States re$ated to t!e imp$ementation o' SAP" T!e &ompany
s!ipped t!ese orders ear$y prior to its Mar&! 0116 SAP imp$ementation to a*oid
possib$e rep$enis!ment de$ays"
Net in&ome in&reased 70 per&ent in t!e 'irst ,)arter &ompared %it! t!e same
,)arter in 011J4 re'$e&ting $o%er interest e#pense and a $o%er ta# rate"
OO)r per'orman&e in t!e 'irst ,)arter represents a so$id start 'or t!e year4
despite an in&reasing$y di''i&)$t retai$ en*ironment4D said Lo!n Anderson4
president and &!ie' e#e&)ti*e o''i&er" CO)r Le*i3s@ brand &ontin)es to per'orm
%e$$ on a g$oba$ basis4 and bene'ited 'rom &ontin)ed gro%t! in o)r emerging Asia
Pa&i'i& marets and in E)rope"
C/e are &a)tio)s gi*en t!e e&onomi& )n&ertainty in t!e United States and ey
marets aro)nd t!e %or$d" Nonet!e$ess4 %e remain 'o&)sed on prod)&t inno*ation4
retai$ e#pansion and optimi(ing o)r g$oba$ 'ootprint4D added Mr" Anderson"
T!e &ompany reported t!at its Aoard o' +ire&tors de&$ared a 521 mi$$ion &as!
di*idend to &ommon s!are!o$ders" In addition4 t!e &ompany reported t!at on Mar&!
02 it redeemed its remaining 70P per&ent bonds4 ')rt!er red)&ing $ong9term debt
by 57< mi$$ion"
T!e &ompany a$so reported t!at it began imp$ementing SAP in t!e se&ond
,)arter in t!e United States" +)e to iss)es en&o)ntered d)ring t!e stabi$i(ation
period4 it &!ose to temporari$y s)spend s!ipments to U"S" &)stomers4 &a)sing t!e
&ompany to miss de$i*ery dates" It !as beg)n to s!ip again and is &)rrent$y
%oring %it! &)stomers to re&o*er t!e missed orders" T!e &ompany remains
&on'ident t!at SAP %i$$ optimi(e operations and red)&e &osts o*er t!e $ong term"
-irst N)arter 0116 >ig!$ig!ts
Page | 35
LEVI STRAUSS & COMPANY
Re*en)es in&$)ded appro#imate$y 576 mi$$ion in U"S" orders t!at %o)$d
!a*e been s!ipped in t!e se&ond ,)arter b)t %ere instead s!ipped in
-ebr)ary" Operating in&ome bene'ited appro#imate$y
5< mi$$ion 'rom t!ese s!ipments"
?ross pro'it in t!e 'irst ,)arter in&reased to 52:2 mi$$ion &ompared
%it! 5:<6 mi$$ion 'or t!e same period in 011J" ?ross margin in&reased to
21"F per&ent o' re*en)es 'or t!e 'irst ,)arter &ompared %it! :6"1 per&ent o'
re*en)es in t!e 'irst ,)arter o' 011J" ?ross margin bene'ited 'rom
!ig!er9margin prod)&t mi#4 impro*ed so)r&ing &osts and $o%er sa$es
a$$o%an&es"
Se$$ing4 genera$ and administrati*e e#penses in&reased to 5F28 mi$$ion
'or t!e 'irst ,)arter 'rom 50<8 mi$$ion in t!e same period o' 011J"
In&reases in e#penses in t!e 0116 period re'$e&t a $o%er bene'it p$an
&)rtai$ment gain and !ig!er se$$ing e#penses re$ated to t!e &ompany3s retai$
e#pansion &ompared to t!e prior year"
Operating in&ome 'or t!e 'irst ,)arter %as 576J mi$$ion &ompared %it!
576< mi$$ion 'or t!e same period o' 011J4 re'$e&ting !ig!er gross pro'it
o''set by !ig!er se$$ing4 genera$ and administrati*e e#penses"
Interest e#pense 'or t!e 'irst ,)arter de&reased F1 per&ent to 5:7
mi$$ion &ompared to 526 mi$$ion in t!e 'irst ,)arter o' 011J" T!e de&rease
%as primari$y attrib)tab$e to $o%er debt $e*e$s and $o%er a*erage interest
rates d)ring t!e ,)arter d)e to t!e &ompany3s debt re'inan&ing a&tions taen
o*er t!e past t%o years"
CO)r so$id operating margins and strong &as! '$o%s !a*e a$$o%ed )s to
&ontin)e to red)&e debt4 and to in*est in o)r brands and retai$ e#pansion4D said
>ans P$oos *an Amste$4 &!ie' 'inan&ia$ o''i&er" C/e !a*e made signi'i&ant
progress in managing in*entory $e*e$s" O)r priority &ontin)es to be &as!
generation as %e %or to ')rt!er s)pport o)r brands and strengt!en o)r 'inan&ia$
position"D
Regiona$ O*er*ie%
Net Re*en)es 'or t!e ,)arter %ere as 'o$$o%sK
3 Increase "4ecrease&
"0 +e,ruary #-. +e,ruary #%. s Constant
Page | 36
LEVI STRAUSS & COMPANY
5i66ions& #$$( #$$/ Re'orted Currency
5erica
s
0%($ 0%*1 "#&3 "2&3
Euro'e 02#* 0#(7 1%3 23
sia
Paci8c
01/- 0171 (3 23
Net re*en)es in t!e Ameri&as region de&reased 0 per&ent &ompared %it!
t!e same period o' 011J" Sa$es in t!e Le*i3s@ brand in&reased in t!e United
States" T!is %as $arge$y o''set by t!e e#pe&ted de&$ine in sa$es in t!e
Signat)re by Le*i Stra)ss & Co"E b)siness4 as %e$$ as a sma$$ de&$ine in
sa$es in t!e +o&ers@ brand in t!e United States" T!ese res)$ts %ere
a''e&ted by t!e ear$y s!ipments des&ribed abo*e"
Net re*en)es in E)rope in&reased in t!e 'irst ,)arter by 72 per&ent on a
reported basis4 and F per&ent e#&$)ding t!e positi*e &)rren&y impa&t
&ompared %it! t!e same period $ast year" T!e in&rease in re*en)es in E)rope
re'$e&ted4 in part4 t!e sa$es gro%t! in t!e &ompany3s brand9dedi&ated retai$
net%or"
Net re*en)es in Asia Pa&i'i& gre% 6 per&ent on a reported basis4 and F
per&ent e#&$)ding t!e positi*e &)rren&y impa&t" Re*en)es in o)r emerging
marets in Asia Pa&i'i& &ontin)ed to e#pand rapid$y %it! de&$ines in &ertain
o' o)r mat)re marets in Asia"
Aa$an&e S!eet and Cas! -$o%
T!e &ompany ended t!e 'irst ,)arter %it! &as! and &as! e,)i*a$ents o' 5000
mi$$ion4 an in&rease o' 588 mi$$ion 'rom t!e year ended No*ember 024 011J" Cas!
pro*ided by operating a&ti*ities %as 571J mi$$ion 'or t!e 'irst ,)arter4
&ompared %it! 57J mi$$ion )sed 'or operating a&ti*ities 'or t!e same period in
011J4 primari$y re'$e&ting $o%er interest payments and a red)&tion o' &as! )sed
'or in*entory and a&&o)nts payab$e"
T!e &ompany red)&ed $ong9term debt by 576 mi$$ion in t!e ,)arter"
Tota$ debt %as 57"<2 bi$$ion at t!e end o' t!e 'irst ,)arter"
Page | 37
LEVI STRAUSS & COMPANY
(Soure! I3TER3ET)
ANALYSIS '())C+
SECON$ DUARTER
Reporte) Net Revenues *e#rease /%
Net %n#ome o0 +& mi""ion
Cha""enging 1#onom$ an) 1R2 Transition %mpa#t Resu"ts
SAN -RANCISCO ;L)$y 64 0116= G Le*i Stra)ss & Co" ;LS&CO"= anno)n&ed 'inan&ia$
res)$ts 'or t!e se&ond ,)arter ended May 024 0116 and 'i$ed its se&ond ,)arter 0116
res)$ts on -orm 719N %it! t!e Se&)rities and E#&!ange Commission"
>ig!$ig!ts in&$)deK
Three Months Ended % Increase
(Decrease)
($ millions) May 25, 2008 May 27, 2007 A Reporte!
Net revenues "#$6 "%,0%6 (8)&
Net income "% "'6 (#8)&
Page | 38
LEVI STRAUSS & COMPANY
Lo%er net re*en)es re'$e&ted red)&ed sa$es in t!e Ameri&as3 region4 part$y o''set by
reported net re*en)e in&reases in E)rope and Asia Pa&i'i&" Net re*en)es in E)rope and
Asia Pa&i'i& %ere do%n s$ig!t$y on a &onstant &)rren&y basis" T!e re*en)e de&$ine in
t!e Ameri&as is $arge$y attrib)tab$e to t!e impa&t o' t!e di''i&)$t U"S" e&onomi&
en*ironment4 s!ipping iss)es re$ated to t!e transition o' t!e U"S" b)siness to a ne%
enterprise reso)r&e p$anning system ;ERP=4 $o%er per'orman&e in t!e U"S" +o&ers@
b)siness and ear$y s!ipments e#e&)ted in t!e 'irst ,)arter in anti&ipation o' t!e se&ond9
,)arter U"S" ERP imp$ementation"
T!e &ompany re&orded 57 mi$$ion in net in&ome in t!e se&ond ,)arter &ompared to 5:8
mi$$ion in net in&ome 'or t!e same period in 011J4 primari$y re'$e&ting $o%er net sa$es4
and !ig!er &osts re$ated to ERP stabi$i(ation e''orts and retai$ e#pansion" Lo%er
operating in&ome %as partia$$y o''set by red)&ed interest e#pense and ot!er 'inan&ing
&osts in t!e period"
O/e e#pe&ted t!e se&ond ,)arter to be to)g!4 and it %as4D said Lo!n Anderson4
president and &!ie' e#e&)ti*e o''i&er" CT!e retai$ en*ironment in t!e United States
remained &!a$$enging" In addition4 o)r transition to a ne% enterprise reso)r&e p$anning
system in t!e United States negati*e$y a''e&ted o)r res)$ts" In&reasing$y di''i&)$t
e&onomi& &onditions in many marets %or$d%ide are impa&ting &ons)mer spending4 b)t
o)r brands remain strong" /e are p$eased %it! t!e &ontin)ed strong gro%t! o' o)r
emerging marets and o)r retai$ net%or aro)nd t!e %or$d"
C?i*en t!e s$o%ing ma&roe&onomi& indi&ators %e are seeing g$oba$$y and o)r &ontin)ed
in*estment to stabi$i(e o)r ERP system4 %e e#pe&t t!e rest o' t!e year to be
&!a$$enging" Nonet!e$ess4 %e are taing de&isi*e a&tions to position t!e &ompany %e$$
'or %!en maret &onditions impro*e4D added Mr" Anderson"
Se&ond N)arter 0116 >ig!$ig!ts
?ross pro'it in t!e se&ond ,)arter de&reased to 5:FJ mi$$ion &ompared %it! 5:8F
mi$$ion 'or t!e same period in 011J" ?ross margin in&reased to :8"J per&ent o'
re*en)es 'or t!e ,)arter &ompared %it! :2"8 per&ent o' re*en)es in t!e se&ond
,)arter o' 011J" ?ross margin bene'ited 'rom a !ig!er9margin prod)&t mi#4 $o%er
so)r&ing &osts and in&reased &ompany9operated store sa$es"
Page | 39
LEVI STRAUSS & COMPANY
Se$$ing4 genera$ and administrati*e e#penses 'or t!e se&ond ,)arter in&reased to
5F62 mi$$ion 'rom 5F:2 mi$$ion in t!e same period o' 011J" Appro#imate$y !a$' o'
t!e in&rease re'$e&ts t!e e''e&t o' &)rren&yQ t!e remainder o' t!e in&rease re'$e&ts
t!e s)bstantia$ &osts re$ated to t!e ERP stabi$i(ation e''orts in t!e United States
and t!e &ompany3s g$oba$ retai$ e#pansion &ompared to t!e prior year"
Operating in&ome 'or t!e se&ond ,)arter %as 520 mi$$ion &ompared %it! 5776
mi$$ion 'or t!e same period o' 011J4 re'$e&ting $o%er net re*en)es4 and !ig!er
se$$ing4 genera$ and administrati*e e#penses"
Interest e#pense 'or t!e se&ond ,)arter de&reased to 5:7 mi$$ion &ompared to
528 mi$$ion in t!e se&ond ,)arter o' 011J" T!e de&rease %as primari$y
attrib)tab$e to $o%er a*erage interest rates and $o%er debt $e*e$s d)ring t!e
,)arter d)e to t!e &ompany3s debt re'inan&ing a&tions $ast year"
CT!is %as &$ear$y a di''i&)$t ,)arter4D said >ans P$oos *an Amste$4 &!ie' 'inan&ia$ o''i&er"
C+espite t!e operationa$ &!a$$enges4 %e &ontin)ed to red)&e o)r debt and paid a
di*idend to o)r sto&!o$ders" O)r ba$an&e s!eet gi*es )s t!e '$e#ibi$ity to %eat!er t!e
e&onomi& &y&$e and in*est in o)r brands to b)i$d o)r b)siness 'or t!e $ong term"D
Regiona$ O*er*ie%
Net Re*en)es 'or t!e ,)arter %ere as 'o$$o%sK
& (ncreae ()ecreae)
("
*+ll+on)
May 25,
2008
May 27,
2007
A
Reporte!
Contant
Currency
A*er+ca "'77 "5#% (%#)& (20)&
,urope "268 "2'' %0& (')&
A+a
-ac+.+c
"%#% "%8% 6& (%)&
Page | 40
LEVI STRAUSS & COMPANY
Net re*en)es in t!e Ameri&as3 region de&reased 7< per&ent &ompared %it! t!e
same period o' 011J" T!e region3s res)$ts primari$y re'$e&t t!e &!a$$enges re$ated
to t!e imp$ementation o' t!e ERP system in t!e United States and t!e impa&t o'
t!e %ea U"S" e&onomy" Sa$es in t!e U"S" +o&ers@ brand de&reased
s)bstantia$$y d)ring t!e period and t!e U"S" Le*i3s@ and Signat)re by Le*i
Stra)ss & Co"E brands reported sma$$er sa$es de&reases" Res)$ts in t!e region
a$so %ere ad*erse$y impa&ted by t!e C!apter 77 'i$ing o' a U"S" &)stomer"
Net re*en)es in E)rope in&reased 71 per&ent on a reported basis and de&reased
: per&ent e#&$)ding t!e positi*e impa&t o' &)rren&y 'or t!e ,)arter" T!e de&$ine in
&onstant &)rren&y re'$e&ted %eaer %!o$esa$e per'orman&e in &ertain marets4
part$y o''set by sa$es gro%t! in t!e &ompany9operated retai$ net%or"
Net re*en)es in Asia Pa&i'i& in&reased 8 per&ent on a reported basis4 and
de&reased 7 per&ent e#&$)ding t!e positi*e &)rren&y impa&t" Re*en)es in t!e
&ompany3s emerging marets in Asia Pa&i'i& &ontin)ed to gro%4 o''set by
de&$ines in &ertain o' t!e &ompany3s mat)re marets in t!e region4 parti&)$ar$y t!e
&ontin)ed %ea per'orman&e in Lapan"
Aa$an&e S!eet and Cas! -$o%
A'ter paying t!e pre*io)s$y anno)n&ed 521 mi$$ion &as! di*idend to &ommon
sto&!o$ders and red)&ing $ong9term debt by 52: mi$$ion4 t!e &ompany ended t!e
se&ond ,)arter %it! &as! and &as! e,)i*a$ents o' 570: mi$$ion4 a de&rease o' 5F0
mi$$ion 'rom No*ember 024 011J" Cas! pro*ided by operating a&ti*ities %as 5707 mi$$ion
'or t!e 'irst !a$' o' 01164 &ompared %it! 5708 mi$$ion 'or t!e same period in 011J4
primari$y re'$e&ting $o%er net in&ome o''set by $o%er payments 'or interest"
Tota$ debt %as 57"<: bi$$ion at t!e end o' t!e se&ond ,)arter"
(Source: (/0,R/,0)
Page | 41
LEVI STRAUSS & COMPANY

ANALYSIS ())C
TIR$ DUARTER
Net Revenues %n#rease 3%! 4ro5th 6#ross 6"" Three Regions
Net %n#ome in#reases &4%
SAN -RANCISCO ;O&tober 04 0116= G Le*i Stra)ss & Co" ;LS&CO"=
anno)n&ed 'inan&ia$ res)$ts 'or t!e t!ird ,)arter ended A)g)st 0:4 0116
and 'i$ed its t!ird ,)arter 0116 res)$ts on -orm 719N %it! t!e Se&)rities
and E#&!ange Commission"
>ig!$ig!ts in&$)deK
Three Months Ended % Increase
($ millions) Au1ut 2', 2008 Au1ut 26, 2007 A Reporte!
Net revenues "%,%%% "%,05% 6&
Net income "6# "6% %'&
>ig!er net re*en)es re'$e&ted gro%t! in ea&! o' t!e &ompany3s t!ree regions" T!e
in&rease in net re*en)es %as primari$y dri*en by &)rren&y4 t!e addition o' brand9
dedi&ated retai$ stores %or$d%ide and sa$es gro%t! at e#isting stores" Re*en)es %ere
Page | 42
LEVI STRAUSS & COMPANY
ad*erse$y impa&ted by %!o$esa$e &)stomer C!apter 77 'i$ings in t!e United States
d)ring t!e se&ond and t!ird ,)arters4 and s$o%er per'orman&e in &ertain marets
impa&ted by %eaening e&onomi& &onditions" T!e net in&ome in&rease in t!e t!ird
,)arter &ompared to t!e same period in 011J primari$y re'$e&ted $o%er interest e#pense"
T!e ongoing stabi$i(ation o' t!e &ompany3s U"S" enterprise reso)r&e p$anning ;ERP=
system $ed to impro*ed order ')$'i$$ment and $o%er &osts in t!e t!ird ,)arter &ompared to
t!e se&ond ,)arter"
OI am p$eased %it! o)r so$id t!ird9,)arter per'orman&e4D said Lo!n Anderson4 president
and &!ie' e#e&)ti*e o''i&er" CA$$ t!ree o' o)r regions gre%4 demonstrating t!at o)r g$oba$
strategies are %oring e*en in t!e 'a&e o' di''i&)$t e&onomi& &onditions aro)nd t!e
%or$d" T!e Le*i3s@ brand is per'orming %e$$ g$oba$$y" And o)r emerging marets and
e#panding retai$ net%or &ontin)e to pro*ide re*en)e gro%t!"
CLooing at t!e ba$an&e o' t!e year4 %e are *ery mind')$ t!at e&onomi& &onditions are
deteriorating in many o' o)r ey marets aro)nd t!e %or$d" In t!is &!a$$enging
en*ironment4 %e are &ontin)ing to in*est in t!e b)siness4 in&$)ding $a)n&!ing o)r 'irst9
e*er g$oba$ Le*i3s@ 217@ &ampaign4D added Mr" Anderson"
Third !uarter "##$ %i&hli&hts
?ross pro'it in t!e t!ird ,)arter in&reased to 52F0 mi$$ion &ompared %it! 5:68
mi$$ion 'or t!e same period in 011J" ?ross margin 'or t!e t!ird ,)arter in&reased
to :J"< per&ent o' re*en)es &ompared %it! :8"F per&ent o' re*en)es in t!e t!ird
,)arter o' 011J" ?ross margin bene'ited 'rom a &!ange in t!e sa$es mi#4
in&reased &ompany9operated store sa$es and $o%er so)r&ing &osts"
Se$$ing4 genera$ and administrati*e e#penses 'or t!e t!ird ,)arter in&reased to
5F62 mi$$ion 'rom 5F:F mi$$ion in t!e same period o' 011J" In&reased e#penses
in t!e 0116 period in&$)de t!e e''e&t o' &)rren&y e#&!ange4 !ig!er se$$ing &osts
re$ated to additiona$ &ompany9operated retai$ stores4 and !ig!er e#pense re$ated
to t!e U"S" ERP stabi$i(ation" S?&A in t!e t!ird ,)arter o' 011J %as positi*e$y
impa&ted by a 57: mi$$ion bene'it p$an &)rtai$ment gain t!at %as not repeated in
t!e 0116 period"
Operating in&ome 'or t!e t!ird ,)arter %as 57:: mi$$ion &ompared %it! 57:F
mi$$ion 'or t!e same period o' 011J" >ig!er regiona$ operating in&ome in t!e 0116
period %as partia$$y o''set by !ig!er &orporate e#penses" T!e in&rease in
Page | 43
LEVI STRAUSS & COMPANY
&orporate e#penses %as $arge$y a res)$t o' $o%er e#penses in t!e t!ird ,)arter o'
011J d)e to t!e bene'it p$an &)rtai$ment gain"
Interest e#pense 'or t!e t!ird ,)arter de&reased to 5FJ mi$$ion &ompared to 52F
mi$$ion in t!e t!ird ,)arter o' 011J" T!e de&rease %as primari$y attrib)tab$e to
$o%er a*erage interest rates and $o%er debt $e*e$s d)ring t!e ,)arter &ompared
to $ast year"
'e&ional (verview
Regiona$ Net Re*en)es 'or t!e ,)arter %ere as 'o$$o%sK
& (ncreae ()ecreae)
(" *+ll+on)
Au1ut 2',
2008
Au1ut 26,
2007
A
Reporte!
Contant
Currency
A*er+ca "6'# "6'0 %& %&
,urope "$06 "265 %6& $&
A+a
-ac+.+c
"%56 "%'7 6& $&
Net re*en)es in t!e Ameri&as3 region in&reased s$ig!t$y4 despite t!e impa&t o'
U"S" &)stomer C!apter 77 'i$ings d)ring t!e se&ond and t!ird ,)arters" T!e
in&rease most$y re'$e&ted !ig!er sa$es 'rom &ompany9operated retai$ stores"
Net re*en)es in E)rope in&reased on a reported and &onstant &)rren&y basis"
T!e in&rease in net re*en)es on a &onstant &)rren&y basis re'$e&ted t!e addition
o' ne% &ompany9operated and 'ran&!ise retai$ stores4 partia$$y o''set by %eaer
%!o$esa$e per'orman&e in &ertain marets"
Net re*en)es in Asia Pa&i'i& in&reased on a reported and &onstant &)rren&y
basis" Re*en)es in t!e &ompany3s emerging marets in Asia Pa&i'i& &ontin)ed to
gro%4 partia$$y o''set by de&$ines in &ertain o' t!e &ompany3s mat)re marets in
t!e region"
Page | 44
LEVI STRAUSS & COMPANY
)alance Sheet and *ash +low
T!e &ompany ended t!e t!ird ,)arter %it! &as! and &as! e,)i*a$ents o' 5702 mi$$ion4 a
de&rease o' 5F7 mi$$ion 'rom No*ember 024 011J" Cas! pro*ided by operating a&ti*ities
%as 5727 mi$$ion 'or t!e nine mont!s o' 01164 &ompared %it! 570J mi$$ion 'or t!e same
period in 011J4 primari$y re'$e&ting $o%er interest payments4 o''set by $o%er operating
in&ome d)ring t!e nine9mont! period"
Tota$ debt %as 57"< bi$$ion at t!e end o' t!e t!ird ,)arter" +)ring t!e nine9mont! period4
t!e &ompany red)&ed $ong9term debt by 5JJ mi$$ion in addition to paying a 521 mi$$ion
&as! di*idend to &ommon sto&!o$ders d)ring t!e se&ond ,)arter"
Source: (/0,R/,0)
Page | 45
LEVI STRAUSS & COMPANY
Ana2!sis
Co-5an! Pers5ecti4e
The ,ission o- .evi Strauss / *o0 is to sustain
responsible coercial success as a &lobal ar1etin&
copany o- branded apparel0 We ust balance &oals o-
superior pro-itability and return on investent,
leadership ar1et positions, and superior products and
service0 We will conduct our business ethically and
deonstrate leadership in satis-yin& our responsibilities
to our counities and to society0 (ur wor1
environent will be sa-e and productive and
characteri2ed by -air treatent, teawor1, open
counications, personal accountability and
opportunities -or &rowth and developent0

3 ,r0 4ohn Anderson
President and *E(, .evi Strauss /co0
Page | 46
LEVI STRAUSS & COMPANY
'SourceG INTERNET+
4E5 3ERSONNE6 7E8IN9 6E:I STR+USS;
SUCCESS $n
COR3OR+TE 2OR69
(1853-present)



LEVI STRAUSS
(1829-1902)
T(e 4ou"2er
Le0$ S#rau)) + o.
Page | 47
LEVI STRAUSS & COMPANY
3ETER E. 8++S< Sr.
(1=1>?2@@*)
E,?Cha$rman of 7oard
6ev$ Stra! A co.
3h$l$p +. Bar$nea!
E,? 3re$dent and Ch$ef E,ec!t$ve OCcer
6ev$ Stra! A co.
Page | 48
LEVI STRAUSS & COMPANY

Robert 9. 8aa
E,? Cha$rman of the 7oard
(1==@?2@@/?erv$ce 1ear)
6ev$ Stra! A Co.




Dohn +nderon
C!rrent 3re$dent and Ch$ef E,ec!t$ve OCcer
6ev$ Stra! A Co.

Page | 49
LEVI STRAUSS & COMPANY


Ear1 Ro"er
C!rrent Cha$rman of 7oard
6ev$ Stra! ACo.




(Soure! I3TER3ET)
6E:I STR+USS; COR3OR+TE 8E+9FU+RTERS
Le0$1) US 6ea27uar#er AT SA3 4RA3SIS,-
Sa" 4ra"$)o* ,A 94111
U.S.A.
Te%! (415) 501-6000
Le0$ S#rau)) + ,o.
1155 8a##er/ S#ree#
4a9! (415) 501-7112
Page | 50
LEVI STRAUSS & COMPANY
Pro2u# :ua%$#/;I"&or'a#$o"!(800) 872-5384
,o")u'er :ue)#$o")!(800) USA-LEVI
Pere""$a%%/ <"o=" a) o"e o& #(e U"$#e2 S#a#e)> 'o)# 5rogre))$0e a"2 ae)#(e#$a%%/
5%ea)$"g $#$e)* Sa" 4ra"$)o (a) ?ee" #(e (o'e o& Le0$1) or5ora#e (ea27uar#er)
)$"e 1866.
Le0$1) EUR-PEA3 6ea27uar#er a# 8RUSSELS
Le0$ S#rau)) Euro5e* @$22%e Ea)# a"2 3or#( A&r$a (LSE@A)
A0e"ue Ar"au2 4ra$#eur 15-23
1050 8ru))e%)
8e%g$u'
,o")u'er I"7u$r$e)!(32).2.641.6011
Reog"$Ae2 a) Euro5e>) e"#er o& rea#$0$#/* or$g$"a%$#/* a"2 2e)$g"* 8ru))e%) $) #(e
)$#e o& our Euro5ea" (ea27uar#er).
Page | 51
LEVI STRAUSS & COMPANY
Le0$1) ASIA-PA,I4I, 6ea27uar#er a# SI3BAP-RE
1 C$' Se"g Pro'e"a2e* D16-01
Brea# Eor%2 ,$#/ Ea)# To=er* S$"ga5ore 237994
Te%! 65-735 9303
4a9! 65-735 2923
S$"ga5ore* re"o="e2 &or $#) (ar'o"$ou) ?%e"2 o& u%#ure* u$)$"e* ar#) a"2
ar($#e#ure $) #(e )$#e o& our A)$a-Pa$&$ (ea27uar#er).

(Soure! I3TER3ET)


Page | 52
LEVI STRAUSS & COMPANY
Page | 53