Levi Strauss & Co’s (LS&Co) global supply chain planning team teamed up with vendor o9 Solutions to create a new enterprise planning system for fabric procurement, while also working with LS&Co’s IT team to develop a new data infrastructure that supports real-time data visibility.
Essentially an open marketplace, the new system shows a live look at the LS&Co supply chain so it can quickly and easily see who has the fabric on hand that it needs to manufacture its clothing. It allows LS&Co’s team to see all the available suppliers and what materials they have, and allows all parties to collaborate virtually in real time on up-to-date raw material needs.
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The company says historically it had to reach out to different suppliers to identify which one has the right fabric for a particular order. Only after hearing back from each supplier individually would the teams decide which supplier was the right one to direct the fabric order to.
The entire process was a long, slow series of linear — and often isolated — decisions that would take more than 60 days to complete. And it prevented the team from seeing everything available in the supply chain, making it incredibly hard to spot cost-saving opportunities.
The new system gives LS&Co the insights they need to assign orders quickly, significantly reducing lead times. It also allows us to match supply to demand in real time, even down to the component level.
The new system also shows fabric purchased from past seasons, which allows the team to go back to those suppliers and use the fabric, removing the need for new orders and reducing costs.
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By GlobalDataThis level of transparency in the supply chain allows it to optimise the entire network, helping to improve processes in ways that deliver significant benefits, particularly around cost and time savings as well as the ability to protect margins.
LS&Co has five system modules in collaboration with o9 Solutions planned for 2024 and early 2025 having created three already: Tops/Bottoms Agility Modeling, Raw Materials Planning and Material Requirement Planning (MRP)-driven Agility.
LS&Co says as it plans to expand the platform throughout 2024, it will add more suppliers and roll out the system’s capabilities more widely through the supply chain.
“The early results from this work have been quite incredible to see,” said Vishal Mankotia, vice president of global supply planning at LS&Co. “Not only are we speeding up the processes, but this tops/bottoms agility planning model has helped us achieve significant reductions in liabilities of both fabric and sundries.”
He added: “This project is a testament to our unwavering dedication to enhancing supply chain process capabilities and introducing real-time data visibility for our manufacturing base. By strengthening our supply chain and transforming into a DTC-first company, we bring ourselves closer to the market and our consumers.”
In April 2024, LS&Co reported an operating loss in the first quarter of 2024, which the company attributed to the discontinuation of its Denizen brand and Russian market exit.
