Levi Strauss & Co Case Study

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PERSPECTIVE 2

PORTER’S GENERIC STRATEGIES

A firm already operating or entering, in an industry, an analysis of the industry using Porter’s Five Forces Model provides a basic assessment of the attractiveness of the industry and the forces that affect it. The next big question is how to make profits that are above the industry average. As various firms in an industry make different levels of profits, it is evident that the industry, and its attractiveness, is only a foundation for the firm, and using this foundation the firm has to operate in such a way that it obtains and maintains a competitive advantage over other firms in the industry to attain higher than average profits.

One of the main objectives of business strategy is to achieve a sustainable competitive advantage over rival firms. A positional advantage, gained by positioning the firm as a cost leader or a product differentiation in the industry leads to sustainable competitive advantage by which the firm can create an above average value for its customers and above average profits for itself. Cost and differentiation advantages are known as positional advantages. (Harvard Literature porter’s Generic Strategy)

LEVI’S®

The Levi’s brand is classic American style and effortless cool and is positioned as the original and distinctive jeans brand. Since their inception in 1873, Levis jeans have become one of the most accepted garments in the world reflecting the aspirations and earnings the loyalty of people for generations Consumers around the globe instantly recognize the distinctive traits of Levi’s jeans — the double arc of stitching, known as the Actuate Stitching Design, and the red Tab Device, a fabric tab stitched into the back right pocket. Today, the Levi’s brand continues to evolve, driven by its distinctive pioneering and innovative spirit. Our range of leading Jeans wear and accessories for men, women and children is available in more than 110 countries, allowing individuals around the world to express their personal view through the style.

The current Levi’s product range includes Levi’s Red Tab Products and those products are the foundation of the brand. They encompass a wide range of jeans and Jeans wear offered in a variety of fits, fabrics, finishes, styles and price points intended to appeal to a broad spectrum of consumers. The 501 jean, the original and best selling five-pocket jean in past .The Red Tab line also incorporates a full range of Jeans wear fits and styles designed specifically for women around the world.

Therefore Levis should expanded range of high-end products. Levi’s Vintage clothing is premium products by offering detailed replicas of our historical products and Levi’s Made & Crafted, a recently-launched line of premium apparel. Differentiation should be continuous to sustain the existing market. (www.levistrauss.com/who-we-are/brands)

DOCKERS

First introduced in 1986 as an alternative between jeans and dress pants, the Dockers brand is positioned as the khaki authority and aspires to be the world’s best and most-loved khakis. The Dockers brand offers a full range of products rooted in the brand’s khaki heritage and appropriate for a wide-range of wearing options. We seek to renew the appeal of the casual pant category by dealing up khakis’ masculinity and swagger and reminding men what they love about the essential khaki pant. This positioning was reflected in the “Wear the Pants “campaign launched globally in December 2009. As per this new innovation different aspect of thinking is require to turn around the company. (www.levistrauss.com/who-we-are/brands)

LEVI ’S STRAUSS SIGNATURE

Levis seek to extend the style, authenticity and quality for which our company is recognized to more value conscious consumers through our Signature by Levi Strauss & Co. TM brand. Levis offer products under this brand name through the mass retail channel in the United States and Canada and value-oriented retailers and franchised stores in Asia Pacific. Levis use these distribution channels to reach consumers who seek access to high-quality, affordable and fashionable Jeans wear, from a company they trust. The product portfolio includes denim jeans, casual pants, tops and jackets in a variety of fits, fabrics and finishes for men, women and kids. Therefore low cost approach is a value creator for low earning segments. Cost leadership is a way you can market the product which improve the products. (www.levistrauss.com/who-we-are/brands)

PERSPECTIVE 3

BCG MATRIX

The concept of BCG's growth-share matrix, central nowadays to business schools' curriculum on strategy provided companies with a disciplined and systematic tool for portfolio management.

To create a BCG matrix, businesses should find market-share and growth-rate data on their business units or products.

[pic 1]Credit: DeiMosz/Shutterstock

Stars: The business units or products that have the best market share and generate the most cash are considered stars. Monopolies and first-to-market products or services are frequently termed stars. However, because of their high growth, stars also consume large amounts of cash. Finally stars are become cash cows if they sustain their success until a time when the market growth rate is declined. Therefore Levi’s should invest in star apparel items. (www.businessnewsdaily.com/-bcg-matrix.html)

Cash cows: Cash cows are the leaders in the market place and generate more cash than they consume. These are business units or products that have a high market share, but lower growth rate. Cash cows provide the cash requirement to turn question marks into market leaders, to cover the administrative costs of the company, to finance research and development, to service the corporate debt. Companies are advised to invest in cash cows to maintain the current level of productivity to maintain the growth. Levi’s product which has high cash flow should invest wisely to sustain the market future. (www.businessnewsdaily.com/-bcg-matrix.html)

Dogs: Also known as pets, dogs are units or products that have both a low market share and a low growth rate. These business units are prime candidates for divest.

Question marks: These parts of a business have high growth prospects but a low market share. They are consuming a lot of cash but are bringing little in return. In the end, question