Levi Strauss & Co. Case

Levi Strauss and Co.

Memorandum to Heidi Green

for purposes of recommending strategies to reroute negative impacts of the new Personal Pair Proposal

| Levi Strauss and Co. |

Memo

To: | Heidi Green |

From: | Consultant |

cc: | |

Date: | October 22, 2013 |

Re: | Analysis of Current Key Issues and Recommendations of Resolve |

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Key Issues

In recent time Levi Strauss and Co. has received responses from customers, women in particular, that our products aren’t fitting them in ways that are pleasing to them. They complain about standard sizing not being tailored to their stature, and continue to voice their displeasure. Our customers have expressed a need for custom pants.

Considering all customer feedback, we have attentively researched the possibility of expansion by offering the Personal Pair Proposal. A proposal to expand into mass customization, by creating kiosks country wide and eventually worldwide for custom orders.

Although this proposal has included cost saving opportunities on top of vast investments, there are some issues with the proposal. Firstly, mass customization is costly. In our case, the new software conversions to a CCTC program, which would have an initial cost of $3 million, and then an additional SG&A cost of $3 a pair, would be an impactful investment. Secondly, no other company in our industry has implemented this model or a similar model; therefore, there is no primary example to study. This also means, most proposed numbers will be roughly calculated, maximizing risk. Also, the risk that others may enter into the market with or expand into the same plan of mass customization.

Recommendations

We should respond to the Personal Pair Proposal with the answer of “yes, let’s begin strategy development to expand into mass customization.” Our answer, of course, will need to be followed by months of planning and reviewing to ensure that risk is at its lowest before the expansion in implemented. But, growth...