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Is American Apparel Going Out of Business?

The Guardian published a disturbingly amusing article on American Apparel that begins with discussions of the founder Dov Charney and oral sex, masturbation, illegal immigrant labor, sexual harassment, socks worn in strange places, and boardroom underwear.

American Apparel has almost become a household name and one of the few remaining American made clothing companies. The company has been praised for great fashionable clothing and offering fair wages, healthcare, and free international phone calls during work hours. As with many companies in today’s economy they are facing lower sales and increased debt. American Apparel’s shares are at an all time low and the company is losing almost $30 million a year.

With the founder Dov Charney’s almost lunatic actions would it surprise you if American Apparel went bankrupt or will these antics just bring more press and sales? Seriously, this article has some hilarious quotes so go read it yourself and don’t forget to read some of the comments, those are quite amusing.

Written by T-Shirt Talk

4 Comments

  1. Tshirtoutlet · October 4, 2010

    I work for a mid size brick and mortar imprinted apparel company (started in 1990) and also manage their retail end tshirtoutlet.com (started in 1996). I met Dov back in 1996 when American Apparel was still pretty small comparatively speaking.

    Lately we have heard from some apparel distributors like Alpha Shirt Company (alphashirt.com) that they won’t be caring AA next spring. If that is the case most online t-shirt shops will end up buying direct from American Apparel. The problem there, unless you have end column pricing, is that buying direct can sometimes double the unit cost.

    Why are distributors dropping American Apparel? I wonder if it’s even their choice. I look at it this way, American Apparel has two distinct parts; one wholesale the other retail. The wholesale end has a smaller mark up and less overhead. The retail end has tons of overhead but the profit margin is much higher.

    In my opinion, it might not be long before American Apparel focuses almost exclusively on its retail end. I would imagine that wholesale would still be available to those companies who are doing label programs and buying a few thousand pieces per size and color but I’m certain that the days when just any online store could afford to buy American Apparel garments are coming to an end.

  2. chris · December 4, 2010

    An Alpha rep and an LAT rep came to my shop on separate occasions and used the “AA is in trouble” as the punchline to their sales pitch. Alpha is threatening a 100% price increase or something like that, hence pulling AA from their catalog. A trusted contact I have in the apparel industry said that there isn’t much to their claim, and to the Alpha rep, I simply replied “well we buy from AA directly anyway so no worries”. One time, Alpha tried setting us up with the actual case pricing for AA products (to match our rates from AA directly) but it was a pain: Email a PO. Wait that’s that the right person to email the PO to. Forward to other person. Wonder if they got the PO. Wait for them to process. Wonder if it’s going to ship on time. Gee thanks for the free shipping dudes. NO NO NO. Yes AA’s retail thing is out of control, but their wholesale direct service runs like clockwork. Order online, click submit, get a confirmation email, get a shipping confirmation, done. IMO, It’s easier to deal with AA than other direct suppliers such as Independent, JS, Alstyle, Next Level, etc. Plus, if you can’t get case pricing from AA, you need to talk a better game. There are guys with basement 4-color presses getting case pricing. Go for it, be nice to the rep and tell them about the large contract/job you’re trying to get. I’m rooting for AA because they make a good product that many customers request again and again. The quality is good and they have rad colors and cuts. People have been saying AA’s going to phase out wholesale since year one. Maybe AA should make a comment on this…

  3. wholesale blank shirts · May 9, 2011

    I believe these antics will bring more press that will result in more sales. American Apparel has fashionable clothing and wholesale service that is easy and affordable.

  4. t shirt printers Advertees · June 5, 2011

    American apparel are still arriving in our workshops on a regular basis. It seems this T shirts reputation amongst small independents is second to none. Despite the price of the T shirts here in the UK they are as popular as ever. With or without Dov this brand has to be unbustable, very likely to be around forever in one form or another.

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