I tried to not hit a subject too often, but some of our favorites keep popping up in notable ways. In this case, our buddy Dov Charney of American Apparel, via a story in the International Herald Tribune. The article deals primarily with how the company is expanding overseas, but in doing so it also points out the unique aspects that we also like to promote.
American Apparel, believes the worldwide brand expansion he began in 1998 from his Los Angeles headquarters is promoting a creative conversation with the international consumer, who now can buy his simple but vibrant smoke-thin T-shirts, skinny jeans and underwear in 231 stores worldwide.
Not since Prada’s black nylon satchels in the 1990s has brand anonymity been as fashionable as it is now among a post-It bag generation. Currently, almost every other girl on European streets is carrying a logo-less American Apparel duffel bag.
No big snobby brand labels. Just good clothes.
The young entrepreneur [Dov Charney] began importing the Hanes brand but, when he began to feel Hanes’ production outsourcing was loosening its grip on solid American design, he set up his own "American" business in 1997, with everything made in one building in central Los Angeles. With stores in countries like (deep breath) China, Britain, Mexico, France, Israel, Sweden, Italy, Belgium, Australia and others, American Apparel is the largest clothing manufacturer in the United States in terms of domestic production.
Must cost more, right? Nope.
The label’s ethical and environmental concerns – production is heavily powered by solar energy, and employees get fair wages and generous benefits – have charmed consumers’ consciences in an over-saturated market.
Joel Howland, a 22-year-old from London who works in hedge funds, notes that Charney’s clothes are not "prohibitively expensive as you might expect, bearing in mind the economic implications of ethical American manufacture." A men’s Organic Fine Jersey short sleeve T-shirt retails for $19, on americanapparel.net. In comparison, a similar, but non-organic T-shirt on gap.com is $18.
A buck more than clothes – with big labels – made in southeast Asia. Not too shabby. And an investment guy really understands why.
Todd Slater, managing director of equity research at Lazard Capital Markets in New York, notes, "American Apparel is a contrarian idea, as it is making clothes without sweatshop labor, paying a living wage and provides all workers with equity and health care for themselves and their families – because domestic manufacturing allows for faster time leads, faster cycle times, more flexibility in production and better quality."
Faster, quicker, better… and respecting the employee to boot! I bet that makes for a successful company.
Slater sees the label’s outlook as rosy: "American Apparel is the most compelling global growth brand, both from a valuation and fundamental perspective. It is growing its store base 30 percent or more this year and sales are tracking above $500 million."
Low tech products, manufactured in America, successfully competing globally. All of you outsourcing lemmings that believe you must set up shop overseas in order to be competitive should be truly embarrassed. Perhaps you should go visit Dov’s underwear factory in Los Angeles to see how the smart guys do it.