Seven years into its sales slump, Levi Strauss & Co. turned its focus in 2004 from looking for revenue growth to simply stabilizing the bottom line. In December 2003, the San Francisco-based jeansmaker hired turnaround experts Alvarez & Marsal...
Seven years into its sales slump, Levi Strauss & Co. turned its focus in 2004 from looking for revenue growth to simply stabilizing the bottom line. In December 2003, the San Francisco-based jeansmaker hired turnaround experts Alvarez & Marsal to help put its house in order, and when the company reported 2003 financials in December, it became clear how disordered Levi’s had become — it took a $349 million net loss for the year.
Through the course of this year, the company unveiled a string of small changes:
In January, the firm began rolling out its Levi Strauss Signature brand to all Target Stores. This marked the mass market line’s first distribution outside of Wal-Mart and offered proof that Levi’s turnaround plans weren’t pinned too tightly on the Bentonville, Ark., behemoth.
In April, Levi’s disclosed it was pursuing a more aggressive licensing agenda, including deals with sourcing powerhouse Li & Fung Ltd.
In May, the company put its $1 billion Dockers brand on the block, saying that a sale could put a hefty dent in Levi’s $2 billion debt load. Five months later, the firm decided to keep the line, saying no one had bid what the company thought Dockers was worth. While Levi’s executives didn’t disclose their target price, sources in the financial community said they thought Levi’s was holding out for $800 million to $900 million.
In October, the company disclosed its focus on cost-cutting — and A&M suggestions — had allowed it to quietly cut its head count by more than 20 percent this year, to 9,500.
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