Levi&#39, S Cowboy Sales In 2018 Are Expected To Exceed $5 Billion And Return To 20 Years Ago.

American classic cowboy

Levi Strauss & Co. (Levi's, hereinafter referred to as "Levi" s) has announced the key financial data in the third quarter of this fiscal year, and has achieved two digit sales growth for fourth consecutive quarters.

In the 2018 fiscal year, Levi 's sales are expected to exceed US $5 billion.

It is worth noting that this will be the first time Levi 's has recovered to this level since 1999.

After nearly 20 years of depression, Levi's has finally returned to the track of healthy development. After taking office in 2011, the company's president and CEO Chip Bergh made significant adjustments to the strategy of Levi s, focusing on core businesses and gradually expanding Levi's s retail network.

By the third quarter, the number of Levi 's stores was 768, an increase of 65 compared to the same period last year.

Levi 's's road to recovery

Founded in 1853,

It is a pioneer in the field of jeans clothing.

In 1997, their annual sales volume reached 7 billion 100 million US dollars, even higher than that of the sports giant Nike.

But after that, the form went down sharply.

Levi 's borrowed heavily from the family's descendants of Levi Strauss to buy and integrate the company's equity.

This has forced them to reduce costs in all respects to maintain the company's development and to shift production lines from the us to overseas.

This has made a great impact on the brand image of Levi s, which has always been regarded as the symbol of the United States.

In the meantime, Levi "s" was also found to be "American made" jeans, which is actually a scandal in China.

Coupled with the fierce competition in the rise of many other denim brands and fashion apparel brands, sales of Levi 's s fell sharply to $4 billion 100 million only four years later.

Over the next ten years,

The performance has been fluctuating, and has never been able to recover the scenery of 90s.

In 2011,

The board of directors invited Chip Bergh, who had worked in Procter & Gamble (Procter & Gamble group, P&G) for 28 years as CEO.

The first thing he did after he took office was to conduct interviews and questionnaires on 60 managers and above management teams.

Chip Bergh said: "when I was in the fifteenth person, I probably knew the problem.

The group has no overall strategic direction, and there is also a problem of coordination among departments. People feel very anxious and confused.

We must make changes. There is no other way. "

In the 18 months after that, 9 of the 11 executives of Levi 's s had left the company; 2/3 of the 150 senior managers left in three years.

In addition to management changes, Chip Bergh has also been set up.

The future development path is to ensure firm performance of core businesses.

The sales of Levi 's are from men, while the main markets are the United States, France, Germany, Mexico and the UK.

He said: "to ensure that these categories and market sales are healthy, we can have more capital to enhance the performance of those places where we are not performing well."

The second step in the development of Chip Bergh is to expand to more potential new products and new markets.

In 2015,

They re launched their women's clothing business, and provided more size and shape choices, as well as T-shirts and denim jackets and other more categories to cater for leisure style market demand.

They have also launched a new smart jacket with Google (Google) to enable consumers to feel touch gestures, send orders to electronic devices in pockets or purses, perform preset functions (see "ornate ambition" report: Google Levi applies for gesture induction fabric patents, and smart jackets with Levi "s" enter the testing phase).

The response of these new products is excellent. While the overall sales continue to grow, the proportion of men's downloading business at the core of Levi 's is declining.

Meanwhile, the attractiveness of Levi s s to young consumers began to pick up: when Chip Bergh took office, the average age of Levi s consumers was 47 years old, and this figure has dropped to 34 years old.

In addition, Levi 's is also actively exploring new markets, including other European countries outside Germany and France, India and China.

The development of these markets is bigger. Compared with the major markets such as the United States, not only the sales growth rate is higher, but also the profit margin is higher.

In the third quarter, the sales of Levi 's amounted to 13.9 billion, an increase of 10% over the same period last year. The adverse exchange rate fluctuations caused a negative impact on sales volume of 14 million dollars, excluding the exchange rate change, sales increased 11% over the same period last year.

Chip Bergh said: "our strategy is effective, and investment in the past few years has begun to pay dividends."

In the third quarter ending August 26th, the key financial data of Levi 's are as follows:

Sales amounted to $1 billion 390 million, an increase of 10% over the same period last year.

Net profit of $130 million, an increase of 48% over the same period

Gross profit margin 53.2%, 51.8% in the same period last year.

In the third quarter, the performance of Levi 'Z in various markets is as follows:

Sales in the Americas amounted to $793 million, an increase of 7% over the same period last year, and operating profit of $163 million, an increase of 4% over the same period last year.

Europe's sales volume was $406 million, up 17% over the same period last year, operating profit of $77 million, an increase of 25% over the same period last year.

Sales in Asia amounted to $196 million, an increase of 8% over the same period last year, operating profit of $15 million, an increase of 30% over the same period last year.

In spite of the impact of exchange rate, sales in the Americas market increased by 9% compared with the same period last year, and wholesale and retail channels increased.

Women's clothing and apparel sales in the European market are excellent.

However, investment in marketing and direct investment channels also has a negative impact on the profitability of the three markets.