Retail stocks are inherently volatile, but American Apparel’s value dropped by about 40% yesterday. That’s nuts.
Why? The Los Angeles-based specialty store announced that it might not be able to pay back a $80 million loan offered up by a London investment firm in March 2009.
While sales over the last year have improved, the company, run by Terry Richardson-kindred spirit Dov Charney, is operating at a huge loss. In fact, the company went $17.6 million over its budget this quarter.
If American Apparel can’t pay that $80 million back by June, it could be forced to close. Do we think that’ll actually happen? Probably not. The company will either make another deal with Lion, or it’ll find additional funding. Whatever happens, it’s pretty obvious that those running American Apparel’s business need some help budgeting. If a company or person is willing to refinance the retailer, the new money source is going to demand that changes be made.



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This is what happens when your company is run by 20 year old girls. (NYC hiring manager, is that you?)
not surprised…they don't really sell anything but basics at high prices. I'd rather buy my plain tees at target for $6 rather than the $20 or $36 they charge…
If that insufferable sleazebag Dov Charney hadn't been spending all the company's money, time and legal resources fighting off and settling countless sexual harassment lawsuits, maybe he'd have a healthy business.
overcharging for simple items doesn't help their cause either. i used to love shopping there but the people that work there are smug individuals that don't help and look at you weird if you don't fit the required AA mold.lame.
Good
every employee in every store i've ever been in acts like you're a broke scumbag and they're fronting the lines @ Gucci on 5th Avenue. get over yourselves. you're not a luxury brand, so why the snobbery? you make a bland product at inflated prices, your only real message to anyone is “sex sells” and your stores are full of ego driven children that everyone hated on the playground growing up. this story isn't surprising. what's surprising is that you've lasted this long.
this is actually really disappointing because i really like that they're such a large company with such an active stance on an issue as important as made in america. their clothes are generally cute enough plus they make really small sizes and i like that a lot of their stuff is unisex. misguided marketing aside i think they're a company that could really use a good image overhaul – what they do is important and shouldn't be taken for granted. i wish all companies would support the american economy to such a degree.
this is actually really disappointing because i really like that they're such a large company with such an active stance on an issue as important as made in america. their clothes are generally cute enough plus they make really small sizes and i like that a lot of their stuff is unisex. misguided marketing aside i think they're a company that could really use a good image overhaul – what they do is important and shouldn't be taken for granted. i wish all companies would support the american economy to such a degree.
well said!
since they got hyped a lot their prices have HIKED, and also I once tried to buy something online and the service I got SUCKED BALLS. sort it aa, or you deserve to go under tbh!
American Apparel touts themselves as a paragon example of “living wages.” This translates to higher costs, and more costly apparel. AA says Eff U to outsourcing, so they have to charge higher prices. I'm a fan of outsourcing, so I wouldn't give them a cent of my money. Target here I come for a t shirt.
Yup, same problem with Abercrombie & Fitch. Companies, if you want our money learn how to fucking deal with the common people!
I personally like Target's shirts a lot more. Better quality, lower price.
everyone's a fan of lower prices and outsourcing until their jobs get exported
Unfortunately, American Apparel clothing has been cited many times for hiring illegal immigrants to work in their factories — so their “Made in the USA” marketing appeal is misleading, as much as their hypersexual advertising is misguided. Clothes manufacturers like Alabama Chanin are more worthy of regard because not only do they make their clothing in an economically depressed area of the US, they also teach their employees advanced tailoring skills — something that American Apparel does not do, which hurts the long-term prospects of their workers.More people are willing to buy USA-made products, but those products must have worth for the price — just look at the popularity of Etsy, for example. US made, higher priced t-shirts and leggings just don't make sense past a certain price point to the average consumer, but a handmade, unique scarf that directly supports the creator does.
I agree with most of the posts here, but the AA store I frequent (Pasadena) is absolutely wonderful, with great staff who follow up if you're looking for a specific item. I've gone to other nearby stores and the CS is AWFUL and the stores aren't well maintained.
i used to work at american apparel, i was recruited in the city and then automatically hired, apparently i had “the look”… anyways, as i went for a meeting in the lower east side, the hiring manager approved that i work part time, suggesting i work 1 or two days a week, i differed and offered at least 2 or 3…once i began work, my manager was a 19 year old girl who told me it was unacceptable to come to a job with 'chipped nail polish.' after four brutal weeks of work, on a two week pay check system , with disapointing wages i mght add, my manager refused to give me two days off i asked to reserve for myself the first day i began. she wanted me to work 7 days a week, with two double shifts on weekends…I AM A STUDENT may i add. when i said how perposterous i thought this was i was told “you should be happy to work for such a well appreciated company………”i took my break and never came back after i took my last pay check….FUCK american apparel
i used to work at american apparel, i was recruited in the city and then automatically hired, apparently i had “the look”… anyways, as i went for a meeting in the lower east side, the hiring manager approved that i work part time, suggesting i work 1 or two days a week, i differed and offered at least 2 or 3…once i began work, my manager was a 19 year old girl who told me it was unacceptable to come to a job with 'chipped nail polish.' after four brutal weeks of work, on a two week pay check system , with disapointing wages i mght add, my manager refused to give me two days off i asked to reserve for myself the first day i began. she wanted me to work 7 days a week, with two double shifts on weekends…I AM A STUDENT may i add. when i said how perposterous i thought this was i was told “you should be happy to work for such a well appreciated company………”i took my break and never came back after i took my last pay check….FUCK american apparel
i used to work at american apparel, i was recruited in the city and then automatically hired, apparently i had “the look”… anyways, as i went for a meeting in the lower east side, the hiring manager approved that i work part time, suggesting i work 1 or two days a week, i differed and offered at least 2 or 3…once i began work, my manager was a 19 year old girl who told me it was unacceptable to come to a job with 'chipped nail polish.' after four brutal weeks of work, on a two week pay check system , with disapointing wages i mght add, my manager refused to give me two days off i asked to reserve for myself the first day i began. she wanted me to work 7 days a week, with two double shifts on weekends…I AM A STUDENT may i add. when i said how perposterous i thought this was i was told “you should be happy to work for such a well appreciated company………”i took my break and never came back after i took my last pay check….FUCK american apparel
I am in the industry and it's an open secret that American Apparel is not “made in America.” Because of NAFTA they can get most of the labor done right across the border in towns like Tijuana. The chain works like this, kids:They make the patterns & cut the shirts in LA (using undocumented laborers, I might add)AA then sends the unconstructed pieces to Mexico, where they are then sewn, exclusive of trims like elastic, collars, buttons, etc. When the bodies are finished they are then sent back to LA for finishing.The factory floor in LA finishes the clothing, packages it and ships it to various AA stores around the world. It makes me ill that they are touting their “made in America” stance like it's so important to them. Clearly it's not when almost half of the labor is outsourced to Mexico. Also, all that shipping back and forth is not cost effective, nor is it ecologically sound. No wonder AA is in a bind.
Uh, “misleading”? Whether the factory employees are legal citizens or not doesn't change the location of the factories themselves (the only legitimate point to be made there is that “Made in the USA” can itself be misleading, which is certainly true). And while your praise of Alabama Chanin is legitimate in itself, it does little to support your criticism of American Apparel, given that AC manufactures an entirely different, narrow, high-end niche of clothing styles. Also, there's certainly no Etsy rule enforcing USA-made products (nor are there inspectors visiting sellers to ensure legitimacy of claims). And plenty of the stuff sold by US-based Etsy sellers isn't actually US-made, but rather “US-modified”, and in terms of clothing particularly, much (if not most) of the US-made stuff is some modification of an American Apparel garment (e.g. silkscreened t-shirts). Yeah, there are nice hand-/USA-made scarves to be found, but how many Etsy shops sew their own basic garments?
I'm in the industry and everything Second cousin said is a lie. Believe me, because I really am an industry insider posting on this anonymous comment board. Look no further for the sources of my claims, I am the only source you need. And yes, I really am in the industry. I swear.
I believe it's pretty common knowledge they make in Mexico, “Made in USA” is kinda fudging the issue. Technically it's Made in (the) America (s). What II don't see, is how anyone possibly thought there was a realistic basis for their sales to grow enough to be able to pay off a loan of that size. Considering all they are selling is basics, during a recession…
Your sarcasm is a bit of a fail. Overpriced basics and outright telling the public that AA is “made in the USA” aside, I don't necessarily have a bone to pick with AA. Every store I've been in, the sales assistants have been nice and the 3 shirts I've bought have held up nicely. But, to be fair, it does come across as a little bit of fraud to tout that AA is an all-American business when it clearly is not.
Its called comparative advantage. Outsource the inefficiency. Don't like it? Learn something useful, like a trade. Want to stay employed? Be an electrician, everyone needs lights or learn plumbing – everyone poops. Don't like it? Then complain.
June is almost around the corner, please keep me updated on the death of AA.
I've worked for them and can confirm they are about as ethical as Hitler was. The company's run by a bunch of mean-spirited, over-grown children.
Thank you, Second cousin. I also don't appreciate the mass mailing American Apparel sent out this weekend advertising sewing jobs that was completely in spanish. What does that imply? English-speakers need not apply.