Robert Haas: New Turbulence In The Jean Pool
Robert Haas's ongoing efforts to get Levi Strauss back on track apparently haven't paid off. On Sept. 28, the San Francisco-based jeans giant said that it would shut down two plants in Texas, resulting in a loss of nearly 1,000 jobs. A day later, Levi's announced cuts of almost 1,500 jobs with the shuttering of four factories in Belgium and France--a painful step for Haas, the chairman and CEO who has long espoused progressive, employee-friendly policies. Levi's says the moves were sparked by sluggish demand for its jeans.
Analysts say the slowdown can be blamed on a combination of increased competition, economic turmoil, and Levi's inability to keep up with fashion trends.
What's more, they say the $7 billion jeans maker has allowed competitors such as Gap, J.C. Penney, and Sears to steal away the most crucial buyers--teens. "Levi's is an item of utility," says retail analyst Kurt Barnard. "Today's kids want more than that." Levi's latest moves, analysts say, will do little to help the company regain its former dominance.