Levi Strauss & Co. Chief Financial Officer Harmit Singh explains how the company has dealt with supply chain issues and a surge in cotton prices during the Covid pandemic, and says he expects technology to play a key role in future supply chain strategies. He speaks with Emily Chang on Bloomberg’s “Chief Future Officer.”
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So supply chain disruption commodity costs. This is all putting
pressure on the process of bringing anything to market. What is

the new normal going to be there when it comes to supply chain
disruption pricing issues et cetera. If you think of supply

chain think of two broad buckets. One is sourcing and second as
is commodity and costing on the sourcing side. Very early on we

said we won’t put all our eggs in one basket. And so we source
across 24 countries and not from any single country to resource

more than 20 percent. You talked about costs you know given our
global buying power. We already negotiated the first half of the

year a very low single digit inflation relative to last year.
The one thing the good the brands so hard has been really

resonating. The consumers we’ve got to take pricing even during
the pandemic. The brand today has pricing for Levi’s 20 21 full

year revenues are on track to match 2019. Fulfilling the
company’s pledge to emerge stronger from the Covid crisis we

committed in the middle of the pandemic. But when our revenues
got back to pre pandemic levels our margins would be up more

than two points and we’ve now delivered on that. But with the
virus still weighing on consumer confidence and supply chains

and inflation surging around the globe this is no time for any
retailer to relax. As you look forward over here I think the

biggest question. This was going to take the learnings from the
pandemic versus who was just going to stay back to what they did

in the past.
I think over time you know because of the loans people have had

during the pandemic there is going to be thinking about how to
globalize your supply chain. Do you concentrate in a few

countries. Do you diversify. Do you bring some production home.
One of the programs we started a couple of years ago was ISE

Flex program is using lasers to finish your denim product. It
used to be done by hand. It should be done overseas. But now we

bring in the blanks and we finish it closer to markets. And so
we are in the process of expanding that program around the

world. So I think people need to think about different ways of
doing it. And I believe technology will play a key role.