They have reviewed their commodity supply. Moreover, they have rather downsized the wholesale channel. Furthermore, most of all, they have cut jobs. Levi’s sack 15% of work staff: as illustrated by Chief Executive Officer Chip Bergh himself, while talking to WWD, the company is going to lay off about 700 employees. Thanks to such decision, the denim group will manage to save around 100 million dollars, on annual basis.
Levi’s sack 15% of work staff
“Although it has been a difficult choice, it mirrors our awareness that we will have to downsize on the way out of the present crisis – commented Bergh (in the picture) –. It will supposedly take us a number of quarters before we enjoy a recovery”. The pandemic and lockdown consequences and repercussions have deeply affected Levi’s: in the second quarter of the year revenues dropped by 62%. As reported by WWD, during the “shutdown” period the group made use of 160 million dollars, in terms of capital assets; they now can rely on two more billion dollars cash after issuing new bonds. Such capital availability is bound to safeguard the brand for more than a year, in the event of any further lockdown, but does not help the group work out its financial problems owing to missed sales.
While dealing with current difficulties, pointed out Bergh, the company therefore decided to focus its investments on the activities they deem as strategic: that is why they have been spotlighting technology to support the digital channel growth. Other than that, the reopening of selling stores sounds encouraging and comforting: in fact, customers queue up out of the stores front door not just to browse around, but for shopping actually. “The conversion rate is undoubtedly positive – he wrapped up – as sales are higher than trade volumes”.
In the pictures (taken from Levi’s website): a vintage suede leather model made by Levi’s (left); Chief Executive Officer Chip Bergh (right)
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