RIP American Apparel?
American Apparel may be in trouble. The company, headed by the controversial founder, Dov Charney, has seen it’s stock fall significantly recently. The company just released its most recent financial results, which shows that the company’s stock has nosedived another 30-percent. That shows a 66-percent loss in the last year. With trading at $0.80 a share, you’d have to sell 15 shares to buy the last shirt off of Charney’s back. And, unless things improve, Dov’s shirt may be for sale soon.
Can American Apparel survive? Not according to Charney. In a recent interview he acknowledged that the company is in financial trouble and “may not have sufficient liquidity necessary to sustain operations for the next 12 months.” Charney has stated that the dream is done in an interview with Bloomberg Businessweek, ”Hipsters are from a certain time period. The stereotype of a hipster is not something people aspire to anymore. Do you want to be a hipster? Nobody wants to be a hipster.”
Okay, so American Apparel has overextended the brand and it market. But, does that mean that nobody wants to wear American Apparel? Charney wants to move the brand away from Gen Y and go more All American and preppy. The question is can he reinvent the brand in less than one year with limited funding. The man has done it before in pulling the proverbial rabbit out of the hat.
(SolutionsJournal.com)
