American Apparel is a clothing manufacturer in the United States. It is a
vertically integratedIn microeconomics and management, the term vertical integration describes a style of management control. Vertically integrated companies in a supply chain are united through a common owner. Usually each member of the supply chain produces a different product or service, and the products combine to...
clothing manufacturer, wholesaler, and retailer that also performs its own design, advertising, and marketing. It is best known for making basic, solid-color cotton knitwear such as T-shirts and underwear, but in recent years it has expanded—to include
leggingsLeggings are a type of fitted clothing covering the legs, which can be worn by both men and women.Originally leggings were two separate garments, one for each leg....
, leotards, tank tops,
vintage clothingVintage clothing is a generic term for new or second hand garments originating from a previous era. The phrase is also used in connection with a retail outlet, e.g...
, dresses,
pantsTrousers are an item of clothing worn on the lower part of the body from the waist to the ankles, covering both legs separately...
,
denimDenim is a rugged cotton twill textile, in which the weft passes under two or more warp threads. This produces the familiar diagonal ribbing identifiable on the reverse of the fabric, which distinguishes denim from cotton duck. Denim has been in American usage since the late 18th century...
,
nail polishNail polish, or nail varnish, is a lacquer applied to human fingernails or toenails to decorate and/or protect the nail plate.-History:...
,
beddingBedding refers to the materials laid above the mattress of a bed for hygiene, warmth, to protect the mattress, and for decorative effect. Bedding is the removable and washable portion of a human sleeping environment. It is more easily and economically replaced than the bed itself...
and
accessoriesFashion accessories are decorative items that supplement and complement clothes, such as jewelery, gloves, handbags, hats, belts, scarves, wigs, watches, sunglasses, pins, stockings, bow ties, hand fans, leg warmers, leggings, neckties, suspenders, and tights....
for men, women, children, babies, and dogs in various prints and colors.
Company formation and growth
American Apparel was founded in 1989 by Canadian
Dov CharneyDov Charney is the founder and CEO of American Apparel, a clothing manufacturer, wholesaler, and retailer. Charney is known for his success as an entrepreneur, passion for simple clothing and love for Strictly Rhythm. His "contrarian" leadership style, which he feels promotes creativity, has drawn...
, who had a long history with T-shirts and a fascination with American culture. It was during Charney's freshman year at
Tufts UniversityTufts University is a private research university located in Medford/Somerville, near Boston, Massachusetts. It is organized into ten schools, including two undergraduate programs and eight graduate divisions, on four campuses in Massachusetts and on the eastern border of France...
that the company took on the name "American Apparel" and began to experiment with screenprinting, importation and other parts of the apparel business. In 1997 after a variety of iterations, including a period of manufacturing in
South CarolinaSouth Carolina is a state in the Deep South of the United States that borders Georgia to the south, North Carolina to the north, and the Atlantic Ocean to the east. Originally part of the Province of Carolina, the Province of South Carolina was one of the 13 colonies that declared independence...
, the company moved to
Los AngelesLos Ángeles is the capital of the province of Biobío, in the commune of the same name, in Region VIII , in the center-south of Chile. It is located between the Laja and Biobío rivers. The population is 123,445 inhabitants...
. Charney began to sub-contract sewing with Sam Lim who, at the time, had a shop with 50 workers under the
Interstate 10Interstate 10 is the fourth-longest Interstate Highway in the United States, after I-90, I-80, and I-40. It is the southernmost east–west, coast-to-coast Interstate Highway, although I-4 and I-8 are further south. It stretches from the Pacific Ocean at State Route 1 in Santa Monica,...
freeway in east LA. Months later the two became partners. In 2000 American Apparel moved into its current factory in downtown Los Angeles where it continued to grow primarily as a wholesale business, selling blank T-shirts to screenprinters, uniform companies and fashion brands.
After its success as a wholesale brand, the company moved into the retail market. The company was ranked 308th in
Inc.Inc. magazine, founded in 1979 and based in New York City, is a monthly publication focused on growing companies. The magazine publishes an annual list of the 500 fastest-growing private companies in the U.S., the "Inc...
's 2005 list of the 500 fastest growing companies in the United States, with a 440% three-year growth and revenues in 2005 of over
US$The United States dollar , also referred to as the American dollar, is the official currency of the United States of America. It is divided into 100 smaller units called cents or pennies....
211 million.
In late 2006 American Apparel announced a reverse merger, in which Endeavor Acquisition Corp., a special-purpose acquisition company founded in July 2005, bought the company for $360 million. The merger closed in December 2007, at which point American Apparel became a publicly traded company. As a result, Charney became the President and
Chief Executive OfficerA chief executive officer , managing director , Executive Director for non-profit organizations, or chief executive is the highest-ranking corporate officer or administrator in charge of total management of an organization...
of the publicly traded company known as American Apparel, Inc. He remained the majority shareholder.
It is also one of the few clothing companies exporting "Made in the USA" goods and in 2007 sold about 125 million dollars of domestically manufactured clothing outside of America. The company also promotes a number of
progressiveProgressivism is an umbrella term for a political ideology advocating or favoring social, political, and economic reform or changes. Progressivism is often viewed by some conservatives, constitutionalists, and libertarians to be in opposition to conservative or reactionary ideologies.The...
policies including immigrant rights and labor policies the company dubs "
sweatshopSweatshop is a negatively connoted term for any working environment considered to be unacceptably difficult or dangerous. Sweatshop workers often work long hours for very low pay, regardless of laws mandating overtime pay or a minimum wage. Child labour laws may be violated. Sweatshops may have...
free."
In 2010, American Apparel's auditors, Deloitte & Touche, resigned after informing the company that its financial statements for 2009 may not be reliable. The resignation led to investigation by U.S. Securities and Exchange Commission and the
United States attorneyUnited States Attorneys represent the United States federal government in United States district court and United States court of appeals. There are 93 U.S. Attorneys stationed throughout the United States, Puerto Rico, the U.S. Virgin Islands, Guam, and the Northern Mariana Islands...
’s office for the Southern District of New York. Subsequently in August, the company was threatened with being delisted from the New York Stock Exchange for failing to submit a quarterly earnings report. It faced lawsuit from some of its investors. Revenues declined, and total debts rose to $120 million, and the company was in danger of defaulting on a $80-million loan from British-based
Lion CapitalLion Capital can refer to:* The Lion Capital of Asoka, a sculpture used as the national emblem of India* Lion Capital LLP, a British private equity firm formerly affiliated with Hicks Muse Tate & Furst* Lion Capital, a former affiliate of Apollo Management...
. Commenting on the loss of 1,500 workers due to concerns over illegal immigration (see below) Charney said "It broke our efficiencies and generated a situation where we were late delivering garments. It lost us an enormous amount of money. It cost us agility."
Production
American Apparel bases its manufacturing in an 800000 square feet (74,322.4 m²) factory in downtown
Los Angeles, CaliforniaLos Angeles , with a population at the 2010 United States Census of 3,792,621, is the most populous city in California, USA and the second most populous in the United States, after New York City. It has an area of , and is located in Southern California...
. The company also owns and operates its own fabric dye house, garment dye house, and knitting facility, all based in Los Angeles. American Apparel has decided not to outsource its labor, paying factory workers an average of over twelve dollars an hour. Garment workers for similar American companies in China earn approximately 40 cents per hour. It claims to have the 'highest earning apparel workers in the world'.
The company uses "team manufacturing" which pools the strongest workers towards priority orders. Each team functions autonomously and determines its own daily production schedule, giving them control over their own hourly wages. After its implementation, garment production tripled and required a less than 20% staff increase. The factory claims to have the capacity to produce 1 million shirts per week and manufacture 275,000 pieces a day. According to
The New York TimesThe New York Times is an American daily newspaper founded and continuously published in New York City since 1851. The New York Times has won 106 Pulitzer Prizes, the most of any news organization...
it is the largest single garment factory in the United States and employs over 4,000 people across two buildings.
A banner on top of the downtown factory states
"American Apparel is an Industrial Revolution." As of December 2008, banners on top of the factories state "
Legalize LA'Legalize LA’’’ was an activist campaign promoting amnesty for undocumented immigrants, propagated through billboards, protests, clothing, advertisements, educational pamphlets, and grass roots support, underwritten by American Apparel...
" and "Immigration Reform Now!"
Vertical integration
American Apparel is a
vertically-integratedIn microeconomics and management, the term vertical integration describes a style of management control. Vertically integrated companies in a supply chain are united through a common owner. Usually each member of the supply chain produces a different product or service, and the products combine to...
company. The integration extends to 260+ retail storefronts, all of which are owned by the company. By integrating all aspects of production and avoiding
outsourcingOutsourcing is the process of contracting a business function to someone else.-Overview:The term outsourcing is used inconsistently but usually involves the contracting out of a business function - commonly one previously performed in-house - to an external provider...
, the company achieves a fast turn-around time from design concept to finished product. On
Charlie RoseCharlie Rose is an American television interview show, with Charlie Rose as executive producer, executive editor, and host. The show is syndicated...
, founder Charney discussed the process of developing new merchandise in their unique retail system, saying that it took just a "couple of weeks" for a bathing suit to go from idea to the retail floor. He claimed that a garment could be designed on Monday and be sold in London the following week.
Retail
The company's expansion into retail was the fastest retail roll out in American history. In 2003 American Apparel opened company stores in Los Angeles, Montreal, and New York to nearly $80 million dollars in sales As of 2008 the company has more than 200 stores worldwide and continues retail growth with new stores in the
United StatesThe United States of America is a federal constitutional republic comprising fifty states and a federal district...
,
IsraelThe State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...
,
ItalyItaly , officially the Italian Republic languages]] under the European Charter for Regional or Minority Languages. In each of these, Italy's official name is as follows:;;;;;;;;), is a unitary parliamentary republic in South-Central Europe. To the north it borders France, Switzerland, Austria and...
,
JapanJapan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south...
,
South KoreaThe Republic of Korea , , is a sovereign state in East Asia, located on the southern portion of the Korean Peninsula. It is neighbored by the People's Republic of China to the west, Japan to the east, North Korea to the north, and the East China Sea and Republic of China to the south...
, the
NetherlandsThe Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...
,
SwitzerlandSwitzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....
,
ChinaChinese civilization may refer to:* China for more general discussion of the country.* Chinese culture* Greater China, the transnational community of ethnic Chinese.* History of China* Sinosphere, the area historically affected by Chinese culture...
,
GermanyGermany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
,
AustriaAustria , officially the Republic of Austria , is a landlocked country of roughly 8.4 million people in Central Europe. It is bordered by the Czech Republic and Germany to the north, Slovakia and Hungary to the east, Slovenia and Italy to the south, and Switzerland and Liechtenstein to the...
,
CanadaCanada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
,
FranceThe French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
,
SwedenSweden , officially the Kingdom of Sweden , is a Nordic country on the Scandinavian Peninsula in Northern Europe. Sweden borders with Norway and Finland and is connected to Denmark by a bridge-tunnel across the Öresund....
,
SpainSpain , officially the Kingdom of Spain languages]] under the European Charter for Regional or Minority Languages. In each of these, Spain's official name is as follows:;;;;;;), is a country and member state of the European Union located in southwestern Europe on the Iberian Peninsula...
,
MexicoThe United Mexican States , commonly known as Mexico , is a federal constitutional republic in North America. It is bordered on the north by the United States; on the south and west by the Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of...
,
United KingdomThe United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
,
IrelandIreland is an island to the northwest of continental Europe. It is the third-largest island in Europe and the twentieth-largest island on Earth...
,
BrazilBrazil , officially the Federative Republic of Brazil , is the largest country in South America. It is the world's fifth largest country, both by geographical area and by population with over 192 million people...
, and
AustraliaAustralia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...
. Stores are planned or under development for
BelgiumBelgium , officially the Kingdom of Belgium, is a federal state in Western Europe. It is a founding member of the European Union and hosts the EU's headquarters, and those of several other major international organisations such as NATO.Belgium is also a member of, or affiliated to, many...
,
IcelandIceland , described as the Republic of Iceland, is a Nordic and European island country in the North Atlantic Ocean, on the Mid-Atlantic Ridge. Iceland also refers to the main island of the country, which contains almost all the population and almost all the land area. The country has a population...
,
ChinaChinese civilization may refer to:* China for more general discussion of the country.* Chinese culture* Greater China, the transnational community of ethnic Chinese.* History of China* Sinosphere, the area historically affected by Chinese culture...
, and
HawaiiHawaii is the newest of the 50 U.S. states , and is the only U.S. state made up entirely of islands. It is the northernmost island group in Polynesia, occupying most of an archipelago in the central Pacific Ocean, southwest of the continental United States, southeast of Japan, and northeast of...
.
American Apparel retail stores are marketed and designed individually rather than homogeneously. Store designs are sparse and typically cost between $100,000 and $400,000 to develop. The company tends to reject midtown, high rent locations and generally avoids in-mall stores. The stores are often hubs for
urban renewalUrban renewal is a program of land redevelopment in areas of moderate to high density urban land use. Renewal has had both successes and failures. Its modern incarnation began in the late 19th century in developed nations and experienced an intense phase in the late 1940s – under the rubric of...
since the company looks for low-rent but high traffic locations like
Houston,
Little Tokyo, New Orleans, college towns and most recently across from the
Apollo TheaterThe Apollo Theater in New York City is one of the most famous, and older, music halls in the United States, and the most famous club associated almost exclusively with Black performers...
on 125th in Harlem. In some stores, the decor features
PenthousePenthouse, a men's magazine founded by Bob Guccione, combines urban lifestyle articles and softcore pornographic pictorials that, in the 1990s, evolved into hardcore. Penthouse is owned by FriendFinder Network. formerly known as General Media, Inc. whose parent company was Penthouse International...
covers from 1970s and 1980s—a style that has been controversial. When scouting for locations, it considers urban areas that can be revitalized. After opening on Southwest Stark Street in
PortlandPortland is a city located in the Pacific Northwest, near the confluence of the Willamette and Columbia rivers in the U.S. state of Oregon. As of the 2010 Census, it had a population of 583,776, making it the 29th most populous city in the United States...
,
OregonOregon is a state in the Pacific Northwest region of the United States. It is located on the Pacific coast, with Washington to the north, California to the south, Nevada on the southeast and Idaho to the east. The Columbia and Snake rivers delineate much of Oregon's northern and eastern...
American Apparel was joined by a
vintage clothingVintage clothing is a generic term for new or second hand garments originating from a previous era. The phrase is also used in connection with a retail outlet, e.g...
store,
sushiis a Japanese food consisting of cooked vinegared rice combined with other ingredients . Neta and forms of sushi presentation vary, but the ingredient which all sushi have in common is shari...
restaurant, shoe shop and modern-styled hotel. In some cases, the company sublets parts of retail locations to other businesses of the same demographic, bringing additional retailers to previously unoccupied space. The bulk of American Apparel retail venues are in
New York CityNew York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. New York exerts a significant impact upon global commerce, finance, media, art, fashion, research, technology, education, and...
and
CaliforniaCalifornia is a state located on the West Coast of the United States. It is by far the most populous U.S. state, and the third-largest by land area...
, mainly San Francisco,
Los AngelesLos Ángeles is the capital of the province of Biobío, in the commune of the same name, in Region VIII , in the center-south of Chile. It is located between the Laja and Biobío rivers. The population is 123,445 inhabitants...
and San Diego.
AmericanApparel.net is the company's e-commerce sales hub. It carries an online inventory of roughly 250,000 SKUs and receives 1.5 million visitors per month. Online sales grew from $13.3 million in 2006 to $29.3 million in 2007 to roughly $40 million in 2009. The company site runs on the Yahoo Stores platform and is included in the Internet Retailer 500 Index.
In late 2007, American Apparel opened a retail location for
vintage clothingVintage clothing is a generic term for new or second hand garments originating from a previous era. The phrase is also used in connection with a retail outlet, e.g...
called California Select in
Echo ParkEcho Park is a hilly neighborhood in Los Angeles, California, northwest of Downtown Los Angeles and southeast of Hollywood.-History:At the end of the 19th century, when the hills were still covered with native vegetation, a horse-drawn streetcar line served the dirt road that is now Echo Park Avenue...
, a district of
Los AngelesLos Ángeles is the capital of the province of Biobío, in the commune of the same name, in Region VIII , in the center-south of Chile. It is located between the Laja and Biobío rivers. The population is 123,445 inhabitants...
Shortly afterward, the company began selling vintage clothing through an
eBayeBay Inc. is an American internet consumer-to-consumer corporation that manages eBay.com, an online auction and shopping website in which people and businesses buy and sell a broad variety of goods and services worldwide...
store of the same name. In 2008, the company was named "Retailer of the Year", following
Calvin KleinCalvin Richard Klein is an American fashion designer who launched the company that would later become Calvin Klein Inc. in 1968. In addition to clothing, Klein has also given his name to a range of perfumes, watches, and jewelry....
and
Oscar de la RentaOscar de la Renta is one of the world's leading fashion designers. He was named to the International Best Dressed List Hall of Fame in 1973.-Career:...
.
Wholesale
American Apparel began by selling high-quality t-shirts to screen-printers and boutiques in 1990 under the American HEAVY label. Although it has made its transition into a primarily retail brand, the company is still one of the largest wholesalers in the country. American Apparel shirts are used as band merchandise and concert t-shirts for the bands, among many others,
Hanson- Musical groups :* Hanson , an American pop rock band* Hanson , an English rock band* The Hanson Brothers, a Canadian punk band and side project of the band Nomeansno- Companies :* Hanson plc, a British building materials company...
,
Van HalenVan Halen is an American hard rock band formed in Pasadena, California, in 1972. The band has enjoyed success since the release of its debut album, Van Halen, . As of 2007 Van Halen has sold 80 million albums worldwide and has had the most #1 hits on the Billboard Mainstream Rock chart...
,
WilcoWilco is an American alternative rock band based in Chicago, Illinois. The band was formed in 1994 by the remaining members of alternative country group Uncle Tupelo following singer Jay Farrar's departure. Wilco's lineup has changed frequently, with only singer Jeff Tweedy and bassist John...
,
Death Cab for CutieDeath Cab for Cutie is an American alternative rock band formed in Bellingham, Washington in 1997. The band consists of Ben Gibbard , Chris Walla , Nick Harmer and Jason McGerr ....
, Foursquare,
Vampire WeekendVampire Weekend is an American indie rock band from New York City that formed in 2006 and signed to XL Recordings. The Band has four members: Ezra Koenig, Rostam Batmanglij, Chris Tomson, and Chris Baio. The band released its first album Vampire Weekend in 2008, which produced the singles "Mansard...
,
MetricMetric is a Canadian indie rock and New Wave band founded in 1998 in Toronto. The band has also at various times been based in Montreal, London, New York City and Los Angeles...
, and
Flogging MollyFlogging Molly is a seven-piece Irish-descendant band from Los Angeles, California, that is currently signed to their own record label, Borstal Beat Records.-Early years:...
as well as websites like
ThreadlessThreadless is an online community of artists and an e-commerce website based in Chicago, Illinois since 2000. Co-founders Jake Nickell and Jacob DeHart started the company with $1,000 in seed money after entering an Internet t-shirt design contest....
, Busted Tees, Print Liberation and the
I Can Has Cheezburger?I Can Has Cheezburger? is the name of a weblog featuring lolcats, which are pictures of cats or other animals with captions, paired for humor value. It was created in 2007 by Eric Nakagawa , a blogger from Hawaii and his girlfriend, Kari Unebasami...
store as the t-shirts are said to fit true to size.
People for the Ethical Treatment of AnimalsPeople for the Ethical Treatment of Animals is an American animal rights organization based in Norfolk, Virginia, and led by Ingrid Newkirk, its international president. A non-profit corporation with 300 employees and two million members and supporters, it claims to be the largest animal rights...
, the animal rights advocacy group, prints its merchandise on American Apparel clothes because they are made domestically and animal-free.
Branding and advertising
American Apparel designs, creates and prints its own advertisements. The company is known for its provocative and controversial advertising campaigns, which is largely the inspiration of the company CEO
Dov CharneyDov Charney is the founder and CEO of American Apparel, a clothing manufacturer, wholesaler, and retailer. Charney is known for his success as an entrepreneur, passion for simple clothing and love for Strictly Rhythm. His "contrarian" leadership style, which he feels promotes creativity, has drawn...
. According to
AdageAn adage is a short but memorable saying which holds some important fact of experience that is considered true by many people, or that has gained some credibility through its long use....
, American Apparel's advertising 'telegraphs the brand' from person to person Their print campaigns are widely considered to be some of the best in the industry The sexually charged advertising has been criticized, but has also been lauded for honesty and lack of airbrushing. American Apparel images often display subjects with their blemishes, imperfections and asymmetrical features highlighted and attached with brief, personal descriptions. Many of the models in American Apparel's sexual advertising are recruited by Charney and his colleagues on the street, or company stores; others are selected after sending their photos directly to the company website. Despite this, many consumers have noted the relatively small sizing American Apparel employs, advising other shoppers to buy larger sizes than normal, though this may be the result of other retailers' use of
vanity sizingVanity sizing, also known as size inflation is used to refer to the phenomenon of ready-to-wear clothing of the same nominal size becoming larger over time...
to market to an overweight American public. Some critics have labeled their models as "cocaine-chic", and another describing them as "pre-pubescent".
For a time, Charney promoted a branding strategy that spotlighted his treatment of workers as a selling point for the company's merchandise, promoting American Apparel's goods as "sweatshop free." In 2008, the company took out a series of political ads featuring the corporate logo that called current immigration laws an "apartheid system." In regards to the company's image overseas, advisor Harry Parnass stated that the brand is about aspiration and that they are "selling the American dream." He dismissed competitors who do the same but refuse to manufacture in America.
The company has also used
pornographic actorA pornographic actor/actress or a porn star is a person who appears in pornographic film. Most actors appear nude in films...
s in some of its ads including
Lauren PhoenixLauren Phoenix is a retired Canadian pornographic actress.-Early life:Phoenix was born and grew up in Toronto...
,
Charlotte StokelyCharlotte Stokely is an American pornographic actress.She started performing in adult oriented content after her roommate was cast in a porn film; Stokely was then asked to appear on camera...
,
Sasha GreySasha Grey is an American former pornographic actress, who has since turned to mainstream acting, modeling and music....
and
Faye ReaganFaye Reagan, formerly Faye Valentine, is an American pornographic actress.In May 2008 she was one of Adult Video Newss four "Fresh New Faces" cover girls. She appeared at the 12th annual Erotic LA convention at the Los Angeles Convention Center in June 2008...
. Some of the company's other ads, which feature nudity or sexual themes, have been banned by various advertising authorities. Most recently, American Apparel agreed to comply with a UK ruling to not run an ad that appeared in VICE Magazine because it had the potential to "widely offend" people.
In 2005 the company was named "Marketer of the Year" at the first-ever
LA Fashion AwardsLos Angeles Fashion Week takes place each March and October in locations throughout the Los Angeles area.-History:...
.
Women's Wear DailyWomen's Wear Daily is a fashion-industry trade journal sometimes called "the bible of fashion." WWD delivers information and intelligence on changing trends and breaking news in the fashion, beauty and retail industries with a readership composed largely of retailers, designers, manufacturers,...
published a survey in April 2007 from Outlaw Consulting, a creative research firm tracking the habits of 21-to 27-year olds, which ranked American Apparel as the 8th most trusted brand, ahead of such clothing brands as
H&MH & M Hennes & Mauritz AB is a Swedish retail-clothing company, known for its fast-fashion clothing offerings for women, men, teenagers and children....
and Levi's. In January 2008 the Intelligence Group, a trend and market research firm, listed American Apparel as their number two Top Trendsetting Brand, behind only
NikeNike, Inc. is a major publicly traded sportswear and equipment supplier based in the United States. The company is headquartered near Beaverton, Oregon, which is part of the Portland metropolitan area...
. In 2008,
The GuardianThe Guardian, formerly known as The Manchester Guardian , is a British national daily newspaper in the Berliner format...
named American Apparel "Label of the Year".
In 2007,
Imp KerrImp Kerr is a Swedish-French public persona living in New York, mostly known for her fake American Apparel campaign.- Biography:...
created a fake American Apparel ad campaign in New York. The stunt lasted almost a year, until it was revealed that the fake ads were actually Photoshop mockups. In a final twist, American Apparel ran a tribute ad on the back cover of Vice magazine showing a compilation of the fake ads.
American Apparel also briefly experimented with advertising in
Second LifeSecond Life is an online virtual world developed by Linden Lab. It was launched on June 23, 2003. A number of free client programs, or Viewers, enable Second Life users, called Residents, to interact with each other through avatars...
with a virtual store on the island named
LerappaLerappa is the private island that was commissioned by American Apparel in Second Life to emulate the company's real world stores in the real world. The store was designed by virtual content designer Aimee Weber and was completed and opened in Second Life on June 17 of 2006...
but shuttered the operation in the fourth quarter of 2007
Woody Allen billboard and lawsuit
In 2007, American Apparel put up two billboards, one in New York and one in Los Angeles, featuring an image of
Woody AllenWoody Allen is an American screenwriter, director, actor, comedian, jazz musician, author, and playwright. Allen's films draw heavily on literature, sexuality, philosophy, psychology, Jewish identity, and the history of cinema...
's character dressed as a Rabbi from the movie
Annie HallAnnie Hall is a 1977 American romantic comedy directed by Woody Allen from a screenplay co-written with Marshall Brickman and co-starring Diane Keaton. One of Allen's most popular and most honored films, it won four Academy Awards including Best Picture...
and Yiddish text, for a period of one week. According to Charney, the billboards were a satire and allegory alluding to both the scene in the movie and the similar controversy experienced by both individuals. Allen strongly objected to this use of his image and sued the company for $10 million. Allen testified at a December 2008 deposition that he considered the company's advertising to be "sleazy" and "infantile."
Although the company said as early as May 2008 that the billboards were meant "strictly as
social parodyA parody , in current usage, is an imitative work created to mock, comment on, or trivialise an original work, its subject, author, style, or some other target, by means of humorous, satiric or ironic imitation...
", there was much debate over whether American Apparel's lawyers would unfairly use Allen's personal life, namely his affair with
Soon-Yi PrevinSoon-Yi Previn or Soon-Yi Farrow is an American actress and wife of film director Woody Allen.-Early life and adoption:...
as their defense at the trial. Charney claimed that these rumors were outright false and that his speech was protected by the
First AmendmentThe First Amendment to the United States Constitution is part of the Bill of Rights. The amendment prohibits the making of any law respecting an establishment of religion, impeding the free exercise of religion, abridging the freedom of speech, infringing on the freedom of the press, interfering...
. In May 2009, the case was settled by American Apparel's insurance carrier for $5 million, with the insurance company paying the bulk of the settlement. The settlement was for half of Allen's initial demand. Dov Charney said that if it had been up to him, he would have continued the case and taken it to trial.
Legalize LA and Legalize Gay
In addition to participating in a variety of immigration protests, the company launched an advertising and advocacy campaign called "
Legalize LA'Legalize LA’’’ was an activist campaign promoting amnesty for undocumented immigrants, propagated through billboards, protests, clothing, advertisements, educational pamphlets, and grass roots support, underwritten by American Apparel...
". The campaign featured advertisements in national papers like
The New York TimesThe New York Times is an American daily newspaper founded and continuously published in New York City since 1851. The New York Times has won 106 Pulitzer Prizes, the most of any news organization...
as well as billboards, t-shirts, bus ads and posters. The company also maintains a Legalize LA portion of their website that features news articles relating to
immigration reformImmigration reform is a term used in political discussion regarding changes to current immigration policy of a country. In its strict definition, "reform " means to change into an improved form or condition, by amending or removing faults or abuses....
, the brand and information on the history of the issue.
After the passing of Prop 8 (which makes same sex marriage illegal in the state) in California in November 2008, American Apparel launched the Legalize Gay campaign. It is similar to the Legalize LA campaign, and shirts with "Legalize Gay" and "Repeal Prop 8" printed on them in the same style as the shirts of Legalize LA are sold by the company.
Canada
In a November 2010 ad running in Canadian alternative weeklies, the company describes itself as "a majority-owned Canadian company, founded and operated by Dov Charney, a Montrealer". The ad goes on to say, "in the end, one of the important things that makes American Apparel special is its Canadian heritage".
Corporate culture and employment
The production system of American Apparel centralizes most of its employees in a single location. By not outsourcing, Charney believes that he knows his workers better and that it ties them directly to the brand. A banner on top of the downtown factory states "American Apparel is an Industrial Revolution."
Charney has stated that American Apparel hires its creatives by their sense of culture and fashion, not their resume. Conversely, the company has also been accused of focusing on personal style and outward appearance in its hiring practices for retail positions.
According to Charney, the unconventional corporate culture at American Apparel is responsible for the company's creativity and rapid growth. He's stated that the company is open about sexuality and its culture because "young people like honesty."
Sexual harassment lawsuits
American Apparel has been subject to several sexual harassment lawsuits, of which three were dismissed or settled while another remanded to arbitration. A fifth was filed in May 2008, premiering on the front page of
TMZ.comTMZ.com is a celebrity news website that debuted on November 8, 2005. It was a collaboration between America Online and Telepictures Productions, a division of Warner Bros., until Time Warner divested AOL in 2009. However, it is still affiliated with AOL News and has the AOL News logo affixed in...
. To date, none of the accusations has ever been proven. In an attempt to resolve one of the cases in which the plaintiff confessed that she had not been subjected to sexual harassment, American Apparel was reprimanded in an opinion by the Second Appellate District for then attempting to issue a press release about the case mentioning an arbitration hearing that had, in fact, never taken place. The company and many media outlets have publicly accused the lawsuit against American Apparel of being extortionary attempts to "shake the company down". The company was later sued by four ex-models for sexual harassment, including one separately named plaintiff who sued the company for $250 million, in a murky lawsuit in which unsolicited nude photographs, consensual sexual text messages and requests for money surfaced. The company was accused of being responsible for these leaks in a later lawsuit.
Labor
As of 2008 the company employs over 10,000 people and operates over 200 retail locations in 18 countries. The company pays its manufacturing employees an average of
US$The United States dollar , also referred to as the American dollar, is the official currency of the United States of America. It is divided into 100 smaller units called cents or pennies....
12 per hour. According to the
San Francisco Chroniclethumb|right|upright|The Chronicle Building following the [[1906 San Francisco earthquake|1906 earthquake]] and fireThe San Francisco Chronicle is a newspaper serving primarily the San Francisco Bay Area of the U.S. state of California, but distributed throughout Northern and Central California,...
the average factory worker at the company makes $80–120 per day, or roughly $500 per week compared to the $30–40 made daily at most other Los Angeles-based garment factories. Employees also receive benefits such as
paid time offPaid time off is a feature in some employee agreements that provides a "resource" of hours that an employee can draw from to take time off from work, without having to specify a reason....
,
health careHealth care is the diagnosis, treatment, and prevention of disease, illness, injury, and other physical and mental impairments in humans. Health care is delivered by practitioners in medicine, chiropractic, dentistry, nursing, pharmacy, allied health, and other care providers...
, company-subsidized lunches,
busThe Los Angeles County Metropolitan Transportation Authority is the California state-chartered regional transportation planning agency and public transportation operating agency for the County of Los Angeles formed in 1993 out of a merger of the Southern California Rapid Transit District and the...
passes, free English as an additional language classes, on-site massage therapists, free bicycles and on-site bike mechanics, free parking in addition to the proper lighting and ventilation. Every floor of the factory includes free telephones where workers can make and receive long distance phone calls. The company's employees in foreign countries do not receive the same hourly wages as their Los Angeles counterparts. However, employees in China will earn US Federal minimum wage. After going public, the company offered employees as much as $40 million in stock shares. The plan grants employees roughly 1 share of stock for every workday they'd spent at the company. Approximately 4,000 of the company's employees are eligible for the program. In previous years the waiting list for employment at American Apparel has had over 2,000 names on it. The company now however is actively looking for staff following an investigation by US immigration found that 1,500 of its workers lacked the legal immigration documents and were subsequently dismissed.
The company's employees are not unionized. In 2003, the
UNITEThe Union of Needle trades, Industrial, and Textile Employees was a labor union in the United States, formed in 1995 as a merger between the International Ladies' Garment Workers' Union and the Amalgamated Clothing and Textile Workers Union...
launched a union drive at the factory. American Apparel countered that the union was "trying to politically force American Apparel into embracing it, regardless of worker interest." In a letter to
The NationThe Nation is the oldest continuously published weekly magazine in the United States. The periodical, devoted to politics and culture, is self-described as "the flagship of the left." Founded on July 6, 1865, It is published by The Nation Company, L.P., at 33 Irving Place, New York City.The Nation...
, Charney claimed that workers organized a
grassrootsA grassroots movement is one driven by the politics of a community. The term implies that the creation of the movement and the group supporting it are natural and spontaneous, highlighting the differences between this and a movement that is orchestrated by traditional power structures...
protest of the union demonstration itself and used it as evidence of the union's unpopularity. The organization reported American Apparel to the
National Labor Relations BoardThe National Labor Relations Board is an independent agency of the United States government charged with conducting elections for labor union representation and with investigating and remedying unfair labor practices. Unfair labor practices may involve union-related situations or instances of...
for interference with the drive. However, American Apparel was not charged as a result of the claims. Additionally, the nonprofit Garment Worker Center, which usually supports UNITE, did not sanction or back their efforts against American Apparel. As part of the settlement, the company posted a document stating that it would not interfere with worker's rights to unionize.
New York TimesThe New York Times is an American daily newspaper founded and continuously published in New York City since 1851. The New York Times has won 106 Pulitzer Prizes, the most of any news organization...
reporter
Rob WalkerRob Walker is an American author and freelance journalist. He is a contributing writer to The New York Times Magazine and blogger for Design Observer....
wrote about the controversy in his book
Buying In and revealed that since the unionization drive, the company Sweat X which was held up as the example for what American Apparel should be, had since gone out of business. He quotes Charney saying more explicitly that "[Sweat X]... fucking failed."
The differences between American Apparel and Sweat X were the subject of the 2010 documentary
No Sweat.
Immigration issues
As early as 2001, American Apparel has been a vocal advocate for reform of U.S. immigration laws. On May 1, 2002 American Apparel shut down its factory to allow the company's workers, many of whom are immigrants, to participate in a pro-immigration rally in downtown Los Angeles. Dov Charney, a Canadian immigrant, also marched alongside the workers. American Apparel participates annually in the May 1st Immigration March and Rally in downtown Los Angeles. In 2008, they added a route from their factory that eventually connected with other supporters near the city hall. The company's politics were eventually spun off into the
Legalize LA'Legalize LA’’’ was an activist campaign promoting amnesty for undocumented immigrants, propagated through billboards, protests, clothing, advertisements, educational pamphlets, and grass roots support, underwritten by American Apparel...
advertising campaignAn advertising campaign is a series of advertisement messages that share a single idea and theme which make up an integrated marketing communication...
.
In 2009, an
ICEU.S. Immigration and Customs Enforcement is a federal law enforcement agency under the United States Department of Homeland Security , responsible for identifying, investigating, and dismantling vulnerabilities regarding the nation's border, economic, transportation, and infrastructure security...
audit of American Apparel's employment records uncovered discrepancies in the documentation of about 25% of the company's workers, implying mainly that they were illegal immigrants. About 1,500 workers were let go in September of that year as a result. American Apparel responded with questions of the effectiveness of such an action and said
"[the firings] will not help the economy, will not make us safer. No matter how we choose to define or label them [illegal immigrants] are hard-working, taxpaying workers.” The ICE audit highlighted a new strategy from President Obama which announced they were shifting away from high profile raids. According to CEO Dov Charney, American Apparel will give priority in hiring to any worker who can get their papers in order.
Environmental policies
The company depends on
environmentally friendlyEnvironmentally friendly are terms used to refer to goods and services, laws, guidelines and policies claimed to inflict minimal or no harm on the environment....
practices and is known for its innovations in sustainability due to vertical integration. American Apparel manufacturing system is designed around the concept of "Creative Reuse"—which converts excess fabric from one garment template into several additional garments such as bathing suit tops, belts, headbands, bows, bras, underwear and children's clothing. This otherwise wasted material reduces the amount of fabric the company needs to produce in addition to expanding its product line. According to estimates, it saves about 30,000 pounds of cotton per week.
American Apparel maintains a bicycle lending program for its employees and according to
People for the Ethical Treatment of AnimalsPeople for the Ethical Treatment of Animals is an American animal rights organization based in Norfolk, Virginia, and led by Ingrid Newkirk, its international president. A non-profit corporation with 300 employees and two million members and supporters, it claims to be the largest animal rights...
it is a vegan-friendly clothing company. As of 2007 the company planned to increase its use of
organic cottonOrganic cotton is generally understood as cotton and is grown in subtropical countries such as America and India, from non genetically modified plants, that is to be grown without the use of any synthetic agricultural chemicals such as fertilizers or pesticides. Its production also promotes and...
within the next four years from over 20% to 80%. American Apparel also sells a line of shirts under the "Sustainable" label that are 100% USDA organic cotton. In 2008, American Apparel purchased over 30,000 pounds of
organic cottonOrganic cotton is generally understood as cotton and is grown in subtropical countries such as America and India, from non genetically modified plants, that is to be grown without the use of any synthetic agricultural chemicals such as fertilizers or pesticides. Its production also promotes and...
known as B.A.S.I.C cotton.
American Apparel installed a 146 kilowatt
solar electric systemSolar energy, radiant light and heat from the sun, has been harnessed by humans since ancient times using a range of ever-evolving technologies. Solar radiation, along with secondary solar-powered resources such as wind and wave power, hydroelectricity and biomass, account for most of the available...
on its factory roof, designed to reduce power costs by at least 20%. These panels power as much as 30% of the factory. The company also recycles its fabric scraps.
Philanthropy
In 2005, the company hosted a bikini car wash benefit with the
American Red CrossThe American Red Cross , also known as the American National Red Cross, is a volunteer-led, humanitarian organization that provides emergency assistance, disaster relief and education inside the United States. It is the designated U.S...
to raise money for the victims of
Hurricane KatrinaHurricane Katrina of the 2005 Atlantic hurricane season was a powerful Atlantic hurricane. It is the costliest natural disaster, as well as one of the five deadliest hurricanes, in the history of the United States. Among recorded Atlantic hurricanes, it was the sixth strongest overall...
. In addition, they packaged and delivered 80,000 shirts to the relief effort in New Orleans and the Gulf Coast. As an underwriter of
Farm AidFarm Aid started as a benefit concert on September 22, 1985, in Champaign, Illinois, held to raise money for family farmers in the United States...
, American Apparel donates the blank shirts that the organization prints and sells as merchandise. They also donated more than $400,000 worth of garments to the victims of the Haitian earthquake through Fashion Delivers as well as over 5,000 pairs of socks to the shoe charity
Soles4SoulsSoles4Souls is a Nashville-based charity that collects shoes from the warehouses of footwear companies and runs shoe drives to collect donations from communities across the United States. The charity distributes these shoes free of charge to people in need, regardless of race, religion, class, or...
.
External links