On a quiet street at the very edge of San Francisco’s Telegraph Hill neighborhood is a red-brick building bursting with blue. This 88-year-old structure, which carries no external signage of any kind, is what Levi Strauss & Co., the 165-year-old inventor of the blue jean, calls its Eureka Innovation Lab. Inside, there is denim everywhere. Jeans hang from hooks on the wall and lie in tidy grids on the concrete floor. They are draped over metal railings and across wooden tables. It is difficult to walk more than 10 feet without stepping over at least one pair of the iconic American creation, responsible for a global market that researcher Euromonitor predicts will be worth nearly $143 billion next year.
Levi’s Eureka Lab is, as its name suggests, committed to research and development for the privately held company, which counted $4.9 billion in revenue in 2017 and leads the world in jean sales. Indeed, much of the denim on display in the lab is in the form of prototypes for styles not yet in market. But the latest innovation to emerge from this facility isn’t a clever take on cut or color (though fashion mavens, it’s worth noting that the wide leg is back in style). It’s an entirely new operating model that further automates the jean-making process by eliminating many manual techniques and dramatically reducing the number of chemicals necessary to create the faded and worn finishes that many denim-wearers love. The key tools to this process? Software and lasers. The result: A complete overhaul in the way Levi designs, makes, and sells its signature stuff.
“It’s a total transformation of our operating model,” says Liz O’Neill, Levi’s chief supply chain officer. “An end-to-end digital environment that has huge implications for manufacturing, inventory management, sustainability, and ultimately how we sell.”
Levi calls it Project FLX, for “future-led execution.” There are three components. The first is a fully digital design process that allows Levi designers to sketch new finishing styles using high resolution tablet computers and software developed by the company in house. Previously available software was too clunky to create the finely tuned designs needed for denim, making physical prototypes necessary. Levi’s new software is sophisticated enough to allow that prototyping to happen digitally and accurate enough to allow the digital file to be sent to a vendor for mass manufacturing. The company says this cuts design and development time in half, from months to weeks or days, for the finishing portion of jeans making.
“The designers can use the tablet to create their design and see a photo-real image of a product that doesn’t exist yet,” O’Neill says. “They can play as much as they want. They can move holes around, make it dirtier or cleaner looking, move the whiskers”—the term for the light crease lines across the front pocket area—“up or down a half an inch.”
The second component is the laser. It may come as a surprise that the worn and artfully ripped jeans you bought at the store likely achieved that look through the manual labor of overseas workers. Yes, you read that right: In the 21st century, there are factories where muscled men and women brush and scrape at freshly dyed denim to give it a weathered patina. A chemical cocktail, one of thousands customized to the specific finish, further achieves the effect.
“It’s recipe-based,” says Bart Sights, vice president of technical innovation at Levi and leader of the Eureka Lab, of the finishing process. “It’s a lot like production cooking, actually. You have experienced people who can look at a jean that’s 50 years old and draft a recipe that chains together manual and machine applications, 15 to 20 steps, that replicates that vintage look.”
Levi’s new process uses lasers made by a Spanish company called Jeanologia to finish the jeans in as little as three steps. Though the technology has long been used by the garment industry to burn visual effects into clothing, its use has been limited in scope and consistently augmented by manual processes. Levi uses it so comprehensively that finishing time for a pair of jeans drops from between 20 and 30 minutes to 90 seconds—a massive improvement.
“That was the giant leap for denimkind,” Sights says. “To believe that you could do all of those different effects with a laser. Nobody ever believed that you could.”
A demonstration of the technology at the San Francisco lab underscores the benefit as well as the spectacle. A Levi technician hangs a light pair of jeans, one of four “base” colors used, in the laser marking machine. (Think: firing range.) With safety glasses on, he initiates the laser, which wipes across the garment several times, giving it a camouflage design, whiskers, and—with a flare for each instance—several holes. A wisp of smoke drifts upward as the laser finishes its run across the denim surface.
The final component of Levi’s new model is enabled by the first two: faster time to market. Though the blue jean originated as workwear, it is a trendy fashion item today; the staggering reduction in times to design and manufacture the product allows Levi to delay final style decisions and reduce inventory build-up.
“It allows us to shift to a make-what-you-sell model,” Sights says. “Instead of making a bunch of stuff months and years in advance and trying to sell it, we’re able to see what’s selling and make accordingly.”
In other words, if the company notices a shift in local consumer tastes, it can fire off a batch of new garb from a nearby factory and get product on shelves many months faster than the old way—a supply chain triumph given that Levi works two years in advance and uses more than 1,000 different finishes in a season, which lasts six months.
“One of the biggest challenges in the industry as a whole is to get closer to market,” says O’Neill. “Denim is one of the hardest products to shorten the lead time and still do it so it looks real.”
Levi has begun piloting its new process with select vendors and expects to fully deploy it around the globe by 2020. For the 30 or so lab rats working at Eureka, it’s another successful idea generated in the idea factory. For Levi executives, it’s the first real change to the way jeans have been made in more than a century.
“It took huge change management in our company to go all in,” Sights says, rubbing his indigo-stained hands together. “Bravery and leadership.”