American Apparel Shuts Down Stores to Rebrand

Published By : 08 Jul 2015 | Published By : QYRESEARCH

American Apparel, the leading apparel chain in the U.S., announced of closing many stores that are underperforming. The move is to save money and give a make-over to the company’s image.

The exact numbers of the stores to be closed out of the total 239, were not revealed by the clothing company, though company sources admitted the move will lead to savings of US$30 million in the next 18 months.

The CEO of the clothing company, recognized that the closing stores in over-saturated and unprofitable market is one of the necessary steps for the company to survive headwinds in the retail sector, save jobs for the large number of employee base, and return the business for long term profit sustainability.

But, many employees of the company, who suffered furloughs and shorter working hours are worried about losing their jobs. As per an employee who has worked with American Apparel for two years- majority of the employees have the fear that any time the change in company decision would hit the employees.

As commented by the CEO, they are all committed to turn the fortune of the company. She took office in January this year, after the former head, Dow Charney, of the Los Angeles based company quit amidst numerous sexual harassment lawsuits.

 Charney was twice fired due to sexual harassment and allegations of mismanagement against him. The former CEO replied to his accusers with above 20 lawsuits and administrative actions, as revealed by America Apparel.

The company firmly believes that all the cases have no basis and intends to aggressively defend such activities, and pursue remedy for actions of Mr. Charney, wherever possible, as added by the news network.

However, Charney’s attorneys states that the whole thing is baseless, a complete sham.
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