In recent years, Levi Strauss & Co has experienced an uneven performance, with flat sales in 2023 and continued stagnation across most markets in 2024, including declines in key markets like the US and France. In response, the company discontinued its footwear line in 2024 to refocus on its core apparel business. This strategic shift is aimed at revitalising growth and improving profit margins, which have been under pressure.
Value chain repositioning and macroeconomic repercussions
In 2024, Levi Strauss & Co continued refining its distribution strategy, and announced the closure of its factory in Plock, Poland, which had operated since 1991 and produced 300,000 units annually. This move marked a significant shift in the company’s manufacturing footprint, driven by cost reviews amid challenging sales. Following the closure, Levi’s production is currently concentrated in Asia – primarily India, Vietnam, Bangladesh and China – which accounts for around 80% of global output, with Mexico remaining a key region for North American supply due to its proximity and shorter lead times.
For Levi Strauss & Co – a US-based company with the majority of its sales in its domestic market – the US government’s “America First” policy shifts have significant implications. Rising import tariffs on goods manufactured abroad will increase the cost of doing business, and ultimately these increased costs will be passed on to the consumer, affecting demand and profitability. Whilst larger scale domestic production can be achieved in the long term, in the short term, production cycles and supply chains could be upended, especially as domestic consumer demand is likely to fluctuate, given the shifting economic landscape.
Resilient prospects for denimwear
Global sales of jeans were stagnant in 2024; however, the category is set to bounce back over 2025-2029, and is predicted to grow at a higher rate year-on-year than global outerwear (excluding jeans).
The long-term prospects for the overall global jeans market see the category growing at 1.8% vs global outerwear which is expected to grow at 0.8% in constant terms, compounded annually, in the period 2024 to 2029
Source: Euromonitor International
Premium jeans are expected to remain resilient, with stable growth prospects across many leading markets. For the most part, this is due to shifting consumer preferences, as they look for quality and, in many instances, purchase less at a higher price point.
Levi Strauss & Co’s main product is premium jeans, and it benefits from the perceived value of denimwear as longwearing. Durability proves beneficial when consumers are more cautious regarding discretionary spending. While economy and premium jeans experienced a decline in sales in real terms in 2024, both segments are expected to bounce back and experience year-on-year growth throughout the forecast period, with premium jeans growing at a stronger rate than economy jeans each year between 2025 and 2029.
Levi’s climate transition plan
Sustainability in fashion continues to be driven by consumer demand for environmentally responsible purchases, and growing regulatory pressures. In 2024, 39% of respondents in Euromonitor’s Voice of the Consumer: Sustainability Survey expressed concern about climate change, underscoring the rising importance of sustainability in both new and second-hand fashion choices.
Levi Strauss & Co’s sustainability strategy continues to align with its long-term brand vision, structured around the pillars of Climate, Consumption and Community. As one of the first apparel brands to adopt validated science-based targets in 2018, the company has since conducted a climate scenario analysis in 2022. In October 2024, Levi Strauss & Co released its inaugural Climate Transition Plan for 2030 detailing updated climate targets, a roadmap to net-zero emissions by 2050, and integrated strategies that align sustainability efforts with business objectives and regulatory requirements across its value chain.
Mounting pressure to disclose value chain practices has seen governments, particularly the EU, shift from voluntary initiatives to mandatory regulations, marking a significant move towards industry-wide accountability. Levi’s climate transition plan for 2030 aims to align business practices with evolving global regulations. Sustainability can be a winning strategy for denim brands amid uncertainty because it not only aligns with growing consumer demand for ethical practices but also builds resilience against rising costs and supply chain disruptions, offering a competitive edge as trade tensions and material shortages drive prices higher.
Read our company profile Levi Strauss & Co in Apparel and Footwear, and New Tariffs, New Rules: Impact of Trump’s Tariffs on Fashion for more analysis on the drivers of the global market and the apparel industry.
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