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LEVI STRAUSS & CO.

LEVI STRAUSS & CO. Scope of Service. Founded in 1853 Privately held by descendants of the family of Levi Strauss $4.2B privately held by the descendents of the family of Levi Strauss The Company is structured around three brands, including Levi’s, Dockers and Levi Strauss Signature

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LEVI STRAUSS & CO.

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  1. LEVI STRAUSS & CO. Scope of Service • Founded in 1853 • Privately held by descendants of the family of Levi Strauss • $4.2B privately held by the descendents of the family of Levi Strauss • The Company is structured around three brands, including Levi’s, Dockers and Levi Strauss Signature • LS&Co. is a worldwide corporation organized into three geographical divisions • Levi Strauss Americas (LSA) which is based in San Francisco Headquarters • Levi Strauss Europe (LSE) which is based in Brussels • Asia Pacific Division (LSE) which is based in Singapore • Top Competitors: • The Gap – 14.2B • V.F. Corporation – 7.22B • INDITEX – 15.36B • LS&Co. has a presence in 40+ countries (either sales offices or distribution facilities). • Domestic Operations include: • Corporate Headquarters in San Francisco, California • Distribution Centers / Customer Services Centers (CSC’s) • Hebron KY • Henderson, NV • Canton, Mississippi • A Shared Service Center (SSC) in Eugene, OR • RFP Guidelines • Pursuing a single source provider to purchase all domestic returns and irregulars for sales and distribution into the domestic discount channel

  2. Competitor Information • 1 competitor – Nzania.com/ Hybrid Apparel • History • Nzania ceased to operate in 2009 due to financial reasons • Lease was taken over by Hybrid Apparel • Warehouse Facilities (leased) • 2 warehouses in Sourthern California totalling 135 sf • Not exclusive to Levi’s product LEVI STRAUSS & CO. Assumptions Gaps • Contract Length: 5 years • Irregulars • Purchase all Irregular product from all LS&Co. US production partners located in Latin America and Asia • Purchase price is predefined at 50% of FOB X Factory • Levi’s bidding based on a Brand Royalty in addition to purchase Price • All saleable product to be marketed to LS &COo.‘s approved OPR’s • Provider controls price levels • Volume • Irregular Imports - 3.5M units • Resale Value - $32.2 M annually • Receive all authorized returned merchandise from domestic retailers • Domestic returns .4M units annually • $3.4 M Resale Value • International shipping knowledge • International freight forwarding expertise • Limited exposure selling to the large volume OPR network Solution • Leverage current model infrastructure • DDP rates will be utilized from manufacturers to Atlanta – least cost solution • Utilize control of the present LS&Co. OPR model and incorporate current GMP merchandise to the major retail channels • Leverage our current OPR relationships to create high level product demand • Set up and maintain a Levi’s branded “ Outlet Site “ to create an additional sales channel • Provide lease offset in McDonough facility • Purchase the assets associated with the RISE automated lines Competitive Position Win Strategy/Game Changers • GENCO Z –score of 6.18 will guarantee all financial commitments will be met • Consider LOC or purchasing upon receipt at US destination with no terms. • Competitive Royalty Rates • Access to additional Discount Retailers – will develop gain share for excess price realized • Trusted and experienced partner – minimal startup risk; all commitments will be met • Capital purchase options, in addition to potential lease offset options • Existing Returns processing experience • Key Points: • GENCO is the current operations provider • GENCO is a trusted provider • GENCO can demonstrate financial stability • Demonstrated ability to provide large scale liquidation solutions that provide brand integrity and recovery • Solid relationship at all levels of the LS&Co. organization

  3. Competitor Information - Services LEVI STRAUSS & CO. • Customer Service - EDI Order processing and compliance to Customer’s brand requirements. • Domestic Sourcing and Production – partnering with “compliant mills” and “embellishers” (screen printing, flocking, wash techniques, and embroidery) offering speed to market processes for the “ready-to-wear” category. • Offshore Development and Sourcing – reacting to volume increases, offshore sourcing strategies are dependent on criteria inclusive of efficiency, cost, development and fabrication capability, quality, compliance and speed to retail. • Inventory Management - effective speed to retail service, aggressive replenishment programs, and superior inventory management. Planning department staffed with former buyers and planners from various retailers. Data and retail analytics for actionable opportunities to improve sales and profit, maximize inventory and minimize risk, capitalize on individual store needs, and help to eliminate customer concerns for inventory management.

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