American Apparel: Case Analysis: American Apparel

908 Words4 Pages
1. Introduction

What do you think when you hear ‘American Apparel’? Trendy? USA manufactured? Controversial ads? Sexual harassment lawsuits against the CEO? Near nudity?

All these perceptions have contributed indirectly to American Apparel’s bankruptcies. But what is the actual reason of their bankruptcies, and what can they do to avoid a repitition? In this thesis, I am going to thoroughly analyse the brand as it is today, in order to find an answer as to why they were failing in the first place. Subsequently, I will find a way to re-launch the brand, so that it can reclaim its position and find success again.

This thesis is commissioned by Artevelde University College Ghent, as part of my final year in BA Communication Management. With this thesis, I hope to shed some light on American Apparel’s history, and convince you of my analysis. Lastly, I also hope to persuade you of what American Apparel, in my opinion, needs to change in order to avoid a third bankruptcy.

2. Brand Determination

2.1. Brand Heritage

“To say that American Apparel has a tumultuous history would be an understatement.” (Highsnobiety, 2016). While founded in 1989, American Apparel was initially meant to be a wholesale company for blank garments. CEO and
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That same year, Sneider formally resigned as CEO, as she felt the new changes underway would no longer allow her to “pursue the course of action needed to succeed nor allow [American Apparel] to stay true to its ideals”. (Li, 2016). Chelsey Grayson was then named as the new CEO, and filed shortly after for the company’s 2nd Bankruptcy. In November 2016, American Apparel was successfully taken over by Gildan Activewear Inc. This acquisition, however, did not include the stores, forcing American Apparel to shut down all 281 stores worldwide, as well as their online store. (The Fashion Law,
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