Levi Strauss to lay off 800 employees to save cost

As a part for its global productivity initiative, Levi Strauss plans to eliminate approximately 800 positions, or nearly 20 percent of its non-retail and non-manufacturing employee population as cost cutting measure. Company expects to generate annualized cost savings in the range of 175 dollars-200 million dollars through such initiatives.

According to the company statement, the first phase of the program will deliver approximately 75 dollars -100 million dollars in annualized savings before restructuring and related charges. Restructuring and related charges of approximately 65 million dollars will primarily be recorded in the first quarter.

T

he denim major plans to carry out massive restructuring by reduction of management layers, removal of duplicative roles and regrouping of country clusters and other structural changes. Other plans include streamlining the company’s product development, planning and go-to-market strategies, implementing efficiencies across the company’s supply chain and distribution network, adopting lower-cost service-delivery models and continuing to pursue more disciplined procurement practices.

Commenting on the strategy, Chip Bergh, President and Chief Executive Officer of the company opined, “These changes will make us more competitive—both in our cost structure and in the marketplace—improving our agility and enabling us to focus on innovation, retail productivity, omni- channel capabilities and enhanced consumer experience in stores.”

Announcing its fourth quarter results last month, the company said its net revenue were slightly down on year over year basis to 1.3 billion dollars. Profit slid down to 17 million dollars, from 53 million dollars same period last year.