Levi Strauss holiday sales set to fall as shoppers move away from denim
Reuters API
Levi Strauss & Co
“While macro pressures have not impacted all apparel categories equally, denim has been a category feeling the brunt of a change in consumer spending patterns,” Citigroup analysts said in a note.
Coresight Research analyst Sunny Zheng expects the U.S. jeans market to decline slightly this year. EuromonitorAmerican Eagle Outfitters
The context
With the United States on the edge of a recession, shoppers, pressured by high inflation, are spending less on discretionary items like clothing, with the denim category, in particular, set for a slowdown following a demand surge in 2021.
A pair of Levi 501 Stretch Skinny
While Levi’s benefited from the need for people to renew their wardrobe post lockdown, “the strength in terms of the customer needing to go back to denim and replenish will be much lower now,” Jane Hali & Associates analyst Jessica Ramirez
Single- and double-pleat trousers are growing in popularity, and consumers are preferring more wider leg and trouser-like silhouettes, said Halie LeSavage, fashion commerce editor at Harper’s Bazaar
Analysts also expect Levi’s gross margins to come under pressure from higher inventory levels, increased promotions and a stronger dollar, even as its jeans became more expensive.
