Levi's to back off Net sales after holidays

The apparel retailer today said it plans to scale back clothing sales from its Levi's and Docker's Web sites after Christmas, and instead move its product lines to selected online retailers, including JCPenney and Macys.

"We're working over the next few months to transition products from the online site to our online retail partners," Jeff Beckman, a Levi's spokesman, said.

Manufacturers such as Levi's have typically looked to e-commerce as an opportunity to cut out middlemen and sell directly to consumers. But taking advantage of this opportunity has proven difficult for many of them. Most manufacturers are more accustomed to shipping bulk orders to distributors or retailers than handling single orders of a pair of jeans, industry observers say.

According to Beckman, the company found e-commerce more expensive than it could afford. Levi's has been reeling in recent years, laying off thousands of workers while seeing its market share decline sharply.

"It became clear that running a world-class e-commerce site had become unaffordable," Beckman said.

Levi's debuted its Web store late last year, expecting that the site's recommendations feature would help set it apart. The feature recommended clothes and styles to customers based on their music and clothing preferences.

But Levi's immediately ran into the problems that confront many manufacturers trying to sell online: upsetting their traditional retail outlets. Faced with a similar threat from its suppliers, giant home improvement chain Home Depot launched a pre-emptive strike in July, threatening to pull suppliers products from its store shelves if they attempted to sell them directly to consumers.

Levi's attempted the reverse strategy, banning its outlets from selling its clothes online.

Beckman said the company won't abandon its e-commerce efforts altogether and is considering the possibility of offering limited edition clothes on its site.

Although Beckman said he did not know exactly when the transition will take place, he said it will happen sometime after the holidays. Initially, JCPenney will offer Levi's and Docker's products online before the holiday season, and Macys is expected to offer the goods sometime after then.