Levi_Strauss_and_Abroad

Levi Strauss At Home and Abroad 1. In 1990, Levi Strauss decided to close its South Zarzamora Street plant. Their decision to close the plant brought Levi Strauss many benefits but along with those benefits, problems accompanied. More than 1,000 people found themselves jobless when Levi Strauss decided to close its South Zarzamora Street plant. The company also found themselves faced with local labor activists that were willing to fight back. Due to the embarrassment from the protest, Levi Strauss found itself donating almost $440,000 to provide employment assistance and training to its former employees. Although the transition faced Levi Strauss with some complications, consequently there were benefits that came from the change. The company was able to significantly cut down its cost per unit in manufacturing their Dockers by reducing salaries and numbers of employees needed to perform the same amount of work as the South Zarzamora Street plant. Many people from the third world country found themselves with a job since Levi Strauss brought their manufacturing company oversea. Levi Strauss's decision to close its San Antonio plant might arguably be heartless to some but it was a valid business decision. Fundamentally, they are still a business and a business's goal is to produce profit. To be as successful as they were then, they had to think of what mattered the most, which was how much profit the company can make. In pertaining to business, their calculative actions made sense. Socially, it was an irresponsible decision. In doing so, more than 1,000 people found themselves jobless. This had a rippling effect which inevitably affected the whole town. It is difficult to argue that the company could have reasonably been expected to keep the plant running. The cost of closing the plant was $13.5 million, which was calculated to be recovered within two years once they move their plant oversea. That meant that Levi Strauss projected to profit $6.75 million per year after the recovery. That is a substantial amount of money to forfeit for a business. 2. What Levi Strauss did for their laid-off employees were generous since it didn't have any obligations to donate towards training and displacement but in actuality, the amount wasn't enough to really make an impact. About 1,115 employees were laid off but the $440,000 donated would only give each employee roughly $395 ($440,000/1,115) to start anew. When it closed all of its U.S. plants, Levi Strauss donated up to $6,000 to each displaced workers to help them with job transitions. Had the company offered this displacement package to the San Antonio employees, it might have had a bigger impact than $395. Inarguable, Levi Strauss could and should have done more for the laid off workers. 3. Levi Strauss's decision to close the San Antonio plant can be considered irresponsible when taken into consideration the amount of effort and reliance that the people of San Antonio had initially invested in the plant. While employed at the plant, the employees felt that they were treated fairly and assumed that the treatment would maintain for longer than nine years. The plant had only been opened for nine years before it closed. The employees in San Antonio were beginning to rely on Levi Straus for their income and financial stability. Some employees also relied on the company for their and their family’s medical insurance. Abruptly halting the plant might have caused a disruptive and panic driven living condition for the employees. Because the plant had only been managed by Levi Strauss for nine years, the company did not have major attachments to the city or the workers. Their actions were purely business concentrated which affected their responsibilities to those that relied on them. 4. Products made by sweatshops should be banned and avoided. Most sweatshops pay their employees far below the legal minimum wages and the working conditions are extremely poor. For instance, in a factory in Shenzen, China, women were forced to work twelve hours shift, not including overtime, and only received two days off per month. Employees in sweatshops are not offered any health care benefits or compensation for injury. Because of the poor treatments of employees, avoiding sweatshop products is the virtuous and ethical thing to do. As consumers have purchasing rights, companies also have hiring rights. It is their prerogative to hire or fire an employee. Although needlessly firing an employee is incomprehensible, it does not warrant a company being shunned from the public. Consumer boycotts are justifiable when it is for the greater good or when a message to a company needs to be heard loud and clear. It can serve as a form of social control over businesses and as a structure for promoting corporate social responsibility. The effectiveness of these boycotts highly depends on consumer participation. When a product or a company is being boycotted against, the effectiveness relies on whether consumers will continue to purchase the product or support the company.