We never thought we'd say this, but it's a pretty good time to be the CEO of American Apparel. As just about every mass-manufacturing apparel company we can think of comes under fire for contributing to the poor working conditions that lead to multiple deadly disasters in Bangladesh factories, one company (which often comes under fire for other reasons) is free from blame: American Apparel, which is just about the only large-scale affordable clothing company that manufactures everything in the U.S. and offers some of the best working conditions in the apparel industry.
At the same time, the company isn't perfect: AA and its founder and CEO Dov Charney have been in a financial hole for years. And, you know, Charney may be a total perv.
Still, he's been in the manufacturing and retail field for decades, and, before founding American Apparel, he worked at less socially responsible companies. In a podcast interview with Reihan Salam for Vice yesterday, Charney (likely pleased that, for once, his company wasn't in the wrong) sounded off on his outsourcing fast fashion competitors.
He says repeatedly that CEOs of these companies--"some of the richest men in Europe"--should be able to pay workers at least two dollars an hour (as opposed to the current average of 20 cents) and that if they can't, then they shouldn't be making clothes.
Charney makes the case for international garment industry reform, calling for an international minimum wage and mechanisms that allow for factories to be granted extensions when necessary.
By comparison, American Apparel does sound like a pretty great company--Charney's seamstresses are paid at least minimum wage in a non-sweatshop environment, and he has the luxury of knowing exactly where, how and by whom his products are produced. He says one of his main goals is to make American Apparel just as financially successful as those fast fashion competitors without sacrificing that, making the argument that retailers like H&M run a "reputational risk" by selling "sexy" swimsuits that are made "in a slave like-setting."
"I think these retailers need their asses handed to them!" he says. He also suggests that 1,100 deaths should be enough of a wake up call that "the CEOs at the top 50 apparel companies should be coming together and having a talk about it."
I mean only 3000 people got hit in the World Trade Center and we talk about it every day in the United States...this is a September 11th, I think, for the apparel industry and for the working people...
Charney also makes it sound like, financially, American Apparel is on the upswing, noting "positive cash flow" and that all the company needs to do to become a "multiple billion dollar" company is to generate an additional $1,000 per day out of every store and double its e-commerce business. "I'll be able to say, boom, we did it, without leveraging art, design, technology, marketing, what have you."
We're not sure American Apparel is quite as clean as Charney is making it sound, but it is undeniably in a pretty good position if consumers become more reluctant to support companies that have become associated with Bangladesh (even if many of them are now trying to help with labor reform there).
It will be interesting to see if and how Charney continues to leverage that position and how it could benefit the company financially going forward.
You can watch the full interview below.