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history of levi strauss and co

history of levi strauss and co Idly standing on a busy street corner, one cannot help but observe a plethora of denim whiz by. Entrepreneur Levi Strauss is the man responsible for creating the booming market and generating a trend in clothing that has swept the nation for nearly 150 years. Through a steady commitment of quality and reliable service, Levi Strauss & Company became one of the most successful business ventures to come out of the 19th century. However, history for this company has not been all peaches and cream. Nearly every business must face crisis from time to time, but it is the unique ability of Levi Strauss & Co. to move on after each adversity, that has made them what they are today. In 1829, Hirsch and Rebecca Strauss welcomed the birth of their sixth child Loeb (Goldish 6) . Little did either of them know that this Buttenheim, Bavarian native would grow to be one of the most successful American entrepreneurs the world would ever see. His father, a dry goods peddler, died when Loeb was just 16 years of age. While his brothers traveled to America in search of work, he remained, and took over his father’s trade. Selling products such as cloth, canvas and blankets enabled him to provide for his mother and sisters who waited in anticipation of leaving the country as well. Two years later, the family set out for their voyage to America and in the process, Loeb was given a new name. Once they arrived in New York, the government officials, unable to understand Loeb’s language, provided him with the new name of Levi Strauss (Goldish 10) . In a new land, Levi resorted to his familiar trade, that of peddling. He continued to do this for a number of years and finally in 1853, he moved to San Francisco to live with his sister and her husband. There, he started a dry-goods business with the family and named it Levi Strauss & Co. With the perseverance and reliability Levi established, the company flourished. Oftentimes, Strauss would travel to the gold mines to sell his goods. Upon high demand, Levi started to provide miners with durable overalls constructed from his canvas fabric. One day, he received a shipment of denim because they ran out of canvas. (Goldish) Upon seeing the positive response, Levi took advantage of this discrepancy and expanded the business to include numerous forms of the material. His blue jeans, denim jackets, coats and dresses were seen quite frequently (Goldish 27) . However, for the already enthusiastic Strauss, it was just a minute sample of what was to come. As the years went on, Levi’ās continued to enlarge itself to become a common household name. Critical junctions of the Levi Strauss Corporation included additions to the company, shifts in power, new products, markets and ideas. Some made progress, while others caused digression. One example is of tailor Jacob Davis, who proved to be a defining point in Levi’ās success. In 1873, Strauss accepted Davis’ idea of adding metal rivets to the pockets of his pants, thus making them stronger. “His riveted pants were a smashing success,” (Gromer 94) . This addition, as tiny as it was, greatly impacted the company. Within a year, 20,000 pairs of these jeans were made (Goldish 34) . Until his death in 1902, Levi Strauss continued to improve the quality and appearance of his products. Trademark additions still present today include two orange arcs sewn into the back pockets and a leather patch of, “two horses trying to pull apart a pair of Levi’s jeans. The company wanted to show just how tough it’s fabric really was,” (Goldish 35) . Following the originator’s passing, power resided in many different hands. Levi Strauss’ family took over the reigns of his company in the beginning of the 20th century, and maintained presidency until 1928. Succeeding Levi’s nephew Sigmund Stern as President, was Walter Haas Sr. For majority of the time between 1928 and 1999, The Haas family ran the Levi corporation. Lapses occurred in 1955 when Dan Koshland was President for just under a year, and between 1981 and 1984, Robert Grohman held the supreme authority (Levi) . In the rapidly changing, apparel industry, Levi Strauss & Co. needed to change it’s image many times by introducing new variations of it’s initial product. These decisions, in the hands of Levi’s executive board, for the most part increased sales and customer interests. To reach out to the children’s market, “Koveralls,” a softer version of overalls, were introduced by Simon Davis in 1912. The new product found much acclamation. In 1920, Levi’s opened a factory where they could mass produce the good and sell it nationally. (Levi) . Although the men’s market was booming, neglect of women was rampant. In 1935, LS&CO. created ‘Lady Levi's®’ and becomes the first company to sell blue jeans for women. (Levi) This idea increased profits immensely and set the stage for future business. From 1960 to 1980, Levi’s introduced some new materials into their lineup. Included were corduroy, polyester and khaki. Each were appropriate for their time, but some outstayed their welcome as sales began to decrease. Introduced in 1986 dockers ® khakis, “were an immediate success, hitting the market just as American men began replacing suits with more casual attire. But in 1993, Dockers missed one of the biggest trends in the khaki market- wrinkle-resistant pants. As other manufacturers began selling them, Dockers stayed put. Sales collapsed. That same year, Levi’s reported its first decline in profits since 1988 (Munk) .” In an attempt to reach out to more customers, Levi Strauss & Co. ventured into the international market in the 1960’s under the leadership of Walter Haas Jr. In twenty years, the company positioned themselves in Paris, Moscow, Prague, Warsaw and Japan. A decision in 1995 made by President Bob Haas to launch a website, seemed to be a good idea at the time, and an additional opportunity to reach a larger market. This time, he was wrong. Fall of 1999, Levi Strauss & Co. decided to discontinue sales on their websites. According to experts, the company lost more than $20 million (Ligos) . The executive board were responsible for decisions of the company that did not work out, however there were many crises they saw that could not be avoided. Events in history such as the Civil War, the San Francisco earthquake of 1906, World War I, the Great Depression and World War II all greatly affected the world as a whole. Levi Strauss & Co. managed to survive all of these crises and more, but the consequences of some were far more destructive than others. In 1861, when the Civil War began, LS &C was met with restrictions on shipping of goods, especially cotton from the South. This greatly affected the company’s supply. In spite of this, the perseverance of Levi Strauss got them through. Once the war concluded, business went back to normal. The earthquake of 1906 was the second in the company’s history, however this time, damages were far more debilitating. One building was completely destroyed and another was greatly damaged. The surrounding city saw property damage totaling $350 million joined with fatalities of 452 (Cray 46-47) . Instead of giving up, the company took their grand loss in stride and rebuilt an even better facility. Another set of stifling setbacks were those during the Great Depression and World War II. During these devastating times sales decreased sharply, but the business now run by the Haas family, continued with the policy of equity that the Strausses so fervently pursued. Through times of economic turmoil, the company stood by their employees and customers, always providing everyone with a fair chance. For example, during the period of instability following the earthquake all workers were paid, even if they could not work because of the damage. Secondly, during World War II, LS& C became one of the first American businesses to employ minorities in its factories. Replacing their advertisement in the window was a proud announcement, “We Hire Freely” (Goldish 44) . In addition to the various world disasters, the company made some blunders themselves. As a result, various product recalls were announced. In December 1996, Little Levi’ās Koveralls and Shortalls were voluntarily recalled by the company, when it was noticed that the snap fasteners on the garments had the possibility of separating and children choking on them (Francis #97-050) . In May of the next year, they had to suffer another loss as well. A recall of approximately 57,000 fleece fabric shirts were made when they were found to be “dangerously flammable,” (Francis #97-121) . An additional recall was made in 2001, when two employees complained of skin irritation from Levi’ās Glossy Finish jeans. The loss of revenue from 40,000 pairs was felt (Barron) . In addition to these setbacks, Levi’ās had to endure the fierce enemy of competition. The turn of the 21st century brings even more apparel companies into the limelight as some wonder what will become of Levi Strauss & Co. Many feel that the future of the Levi’ās corporation will be a very bleak one. Some attribute this to poor marketing, while others see it as a result of the never-ending competition. “Sometime around 1990, a great brand began coming apart at the seams. Leviā’s market share among males ages 14 to 19 has since dropped in half, it hasn’t seen a successful product in years, its advertising campaigns have been failures, its in-store presentations are embarrassing, and its manufacturing costs are bloated,” (Munk 84) . The bottom line is, sales have decreased immensely and as a result, thousands have been laid off and many factories shut down. However, LS&Co. has proven to be a company that has never simply faded into the background when times get rough. The company has managed to overcome obstacles such as natural world disasters, failed products and ineffective ventures into new markets. “Levi’s is still one of the world’s great brands, better known than Marlboro, Nike, or Microsoft. No one- not Tommy Hilfiger, not Lee, not Gap- comes close to it in jeans sales. Last year, on revenues of just under $6 billion, Levi Strauss produced $1.1 billion in cash flow. ” (Munk 85) . Entrepreneur Levi Strauss should certainly be proud of that. Bibliography: Works Cited Barron, Kelly. “Getting A Rise Out Of Levi’s.” Forbes 26 November 2001: 156-158. Cray, Ed. Levi’s: The “Shrink-to-Fit” business that stretched to cover the world. Boston: Houghton Mifflin Company, 1978. Francis, Jane. “CPSC and Levi Strauss Announce Infant and Toddler Koverall and Shortall Recall .” U.S. Consumer Product Safety Commission 20 December 1996: Release # 97-050. Francis, Jane. “CPSC and Levi Strauss & Co. Announce Recall of Garments Made From a Flammable Fleece Fabric.” U.S. Consumer Product Safety Commission 14 May 1997: Release # 97-121. Goldish, Meish. Levi Strauss: Blue Jean Tycoon. Florida: Rourke Enterprises Inc., 1993. Gromer, Cliff. “Levi’s Jeans.” Popular Mechanics May 1999: 94-97. Levi Strauss & Co./ History. Levi Strauss & Co. webpage. 19 Nov. 2001 . Ligos, Melinda. “Clicks and Misses.” Sales and Marketing Management June 2000: 68-76. Johnson 8 Munk, Nina. “How Levi’s trashed a great American brand.” Fortune April 12 1999: 82-90. Van Steenwyk, Elizabeth. Levi Strauss: The Blue Jeans Man. New York: Walker, 1988.

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