COVID-19 generic hero

Working With Our Suppliers in the Time of COVID-19

LS&Co. Newsroom
Levi Strauss & Co.
July 2, 2020

Editor’s Note: This article was updated on February 9, 2020 to reflect the ongoing nature of our partnership with our suppliers and the reach of the grants the Levi Strauss Foundation provided in apparel supply chain worker communities.

In line with our history of strong, collaborative supplier relationships and a longstanding commitment to worker well-being in our supply chain, we have been working closely with our suppliers to find the best way through the global COVID-19 pandemic.

We have taken full responsibility – and are paying in full – for all the finished, ready-to-ship and in-progress orders that were outstanding at the onset of the pandemic. We have also been using raw materials received by suppliers prior to the pandemic. While we extended our payment terms, we believe our current terms are consistent with industry practice, and we have not asked for any discounts on payments. Our sourcing leads are staying in close conversation with suppliers and we are factoring their circumstances into our decisions.

To support our suppliers’ operations and ability to pay their workers during the pandemic, we have ensured that all suppliers have access to working capital financing. Since 2014, we have had an ongoing program with the International Finance Corporation (IFC) that suppliers could use to get early payments at favorable market rates. Since the pandemic began, more suppliers have been utilizing the program and we have worked with the IFC to increase the available financing amounts to meet the growing need. The majority of our products are made by suppliers with access to the IFC program, which also provides better rates to suppliers who perform well on our social and environmental assessments, thus incentivizing respect and protection of worker rights. We also now provide additional assistance to suppliers not in locations served by the IFC program.

Across 2020 and 2021, the Levi Strauss Foundation is making grants totaling $1.7 million to organizations that have been supporting apparel supply chain workers during the COVID-19 pandemic. To date, grants already disbursed have funded organizations providing support in the form of food, cash and housing assistance, personal protective equipment (PPE), and medical care to approximately 650,000 apparel workers and family members. Additionally, to ensure the continued safety of workers, their families, and their communities, grantees are working to train at least 3,400 healthcare and frontline workers on hygiene and safety practices. Overall, from 2016 to 2020, Levi Strauss Foundation provided $10.2 million in grants focused on worker rights and worker well-being in the apparel manufacturing supply chain.

In addition, we have been proactively pursuing partnerships with U.S. government institutions to leverage public funds and expertise to further support worker communities in our sourcing countries. In late 2020, we signed a Memorandum of Understanding with the U.S. Agency for International Development (USAID) to work together in 2021 to create a more resilient apparel and footwear sector and workforce, enhance the rights and welfare of workers, and empower women in the workforce. We will continue to pursue meaningful action within this and other potential partnerships to drive toward positive impact for workers.