Levi Strauss has denied that its decision to launch a new value brand in Europe is a response to the problem of grey market imports of its top of the range Levi's jeans.
The company announced that it would be bring its Levi Strauss Signature brand to the UK, France and Germany with a launch targeted for early 2004.
Last July Levi Strauss won a marathon legal battle against Tesco and Costco, with the High Court ruling the chains could not source cheaper Levi's jeans from overseas. But the retailers protested that consumers wanted the lower priced goods.
A Levi Strauss spokesman drew a distinction between the grey market and the new brand, saying: "The court case was about Levi's. This is a completely new brand for the requirements of people who shop in the value channel."
He expected the new brand would retail for about £25 compared with a starting price of £30 to £35 for Levi's.
The new brand is due to make its world debut in the US in July, when it is launched in Wal-Mart. But the spokesman said it was not an exclusive deal with Wal-Mart in the US, and no decision had been made on whether Signature jeans would be sold in Asda.
He said: "We are in talks with a number of value channel retailers but no agreements have been signed with anybody."
The company would only deal with retailers who already sell apparel, he said, adding: "We do not want Signature to be an occasional line in a retailer who does not otherwise sell clothing."
He added that Levi's and Signature were two distinct brands, with distinct distribution channels. "There is no possibility of both brands being sold by the same retailer."
>>p41 Race to the grey market