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Why you should be sad that American Apparel may go out of business

Why you should be sad that American Apparel may go out of business
AnAmerican Apparel retail store window. (Saul Loeb / AFP / Getty Images)

American Apparel seems to be on its last disco-panted leg.

As a woman who has tried to squeeze into an American Apparel bodysuit (because DKNY doesn't sell them anymore!), recoiled at the image of a young girl bent over showing her crotch in one of the brand's advertisements and shuddered while reading stories about the sexual proclivities of founder Dov Charney in the workplace, I thought I would be celebrating.

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But I'm not; I'm sad — sad for the labor force, the local garment industry and for Los Angeles, which American Apparel has helped to promote as an arbiter of cool since it began here as a T-shirt label in 1989.

On Monday, the L.A.-born-and-bred clothing brand warned of a possible bankruptcy filing after reporting a net loss of $19.4 million in the last quarter.

The company, which ousted Charney last year in the wake of several sexual harassment allegations, named a new CEO, Paula Schneider, in January. She has been trying to save American Apparel through cost cutting, workforce reductions, store closures, restructuring of debt and what I'd call a serious image overhaul, jettisoning Charney's "sex sells" vision in favor of a girl-powered, rah-rah inclusivity.

All summer, the American Apparel PR machine has been in overdrive, supplying clothes to celebrities and alerting the media when and where they've been worn.  On July 10, a press release went out announcing that feminist icon and "Girls" actress Lena Dunham had Instagrammed a picture of herself in a lip-print crop top. On the Fourth of July, no less than Kim Kardashian, Bella Thorne, Taylor Swift, Vanessa Hudgens and Rumer Willis all wore versions of the retailer's American flag print swimsuits and Instagrammed photos to show and tell.

Even First Daughter Sasha Obama was snapped wearing American Apparel — a $38 short-sleeved ribbed Henley dress in gray. "This is such a cool summer look for under $50!!!" the press release noted.

And in June, to celebrate the Supreme Court's marriage-equality ruling, American Apparel created a signature T-shirt in collaboration with the Human Rights Campaign, with 15% of sales going to the HRC. The initiative followed a company tradition of mixing cause and commerce, supporting political causes including LGBT pride and immigration reform. And Miley Cyrus took to social media to promote this one.

But the PR blitz seems to be too little too late.

Schneider has reduced the product assortment in stores by about 30%, and it shows. I recently visited the Melrose Avenue location, in the throes of its back-to-school promotion, and there wasn't a lot of newness on the floor.  The hoochie wear that the brand was built on was still there — the kind of shiny, metallic pearl crop tops, bra tops, print leggings and skater minis that make you sweat just looking at them. But it wasn't front-and-center.

Fresher looks included the high-waist jean shorts and mom jeans that are in fashion now, as well as jean jackets, letterman jackets, crisp white denim overalls, retro-'70s clogs and raw leather sling purses just big enough to hold a phone. There were also racks of pleated crepe pants and chambray tent dresses that a mom might actually wear. And where else can you get terrycloth sweatbands, striped tube socks or a pair of jelly shoes — in a dozen colors?

The staff was friendly, maybe overly so, apologizing that the music system was on the fritz, which unfortunately created a shopping atmosphere that was deadly silent. But there was no fashion direction from the staff, on signage or on mannequins either. Instead, trends ceded to the cult of individuality, available in a rainbow of colors and unisex styles.

In terms of basics with an edge, American Apparel has got it all over Gap right now. But the sizing isn't exactly democratic (no XXLs here). Neither are the prices. Jean shorts for $58, overalls for $120, jean jackets for $125 and a phone sling for $35 must seem outrageous to shoppers weaned on $17 jeans from fast fashion giants such as Forever 21 and H&M, which rely on low-cost, off-shore labor to keep prices low.

Of course what you're paying for at American Apparel is "Made in the USA," "sweatshop free," and "fair wages."

"American Apparel employs more than 6,000 skilled industrial workers in Southern California, all of whom are paid a fair wage and have access to affordable heathcare and benefits," read the hangtags on all the clothing.

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But for how long?

Things are not looking good. American Apparel has cut costs, reduced hours and laid off factory workers, which has prompted several demonstrations around Los Angeles. The company has nearly $235 million in long-term debt, must come up with $13.9 million for a bond payment in October, and has only $6.9 million in cash as of June 30. American Apparel is also fighting a number of lawsuits from Charney, who is determined to return to the brand he created. And the legal tit-for-tat storyline has so dominated the media in recent months that it has no doubt tainted shoppers' perceptions. Soon, the company could be forced to start selling off assets or exploring alternative distribution channels. And more people will likely lose their jobs.

It's a sad state of affairs, especially since it all seems to be happening just as we are really starting to open up a dialogue about conscious consumerism and to see the results of fashion activism. (In recent weeks, animal rights group PETA has ignited two fashion controversies that forced responses from Hermes, Stella McCartney and Patagonia. And in May, the "True Cost" documentary was released, tallying the human and environmental cost of fast fashion.)

Rather than relying on same old same-old celebrity Instagram endorsements, maybe American Apparel should have worked harder to connect the thread of local pride and ethical treatment of workers to its brand DNA? How about a social media campaign with a tagline like #IWearFairLA? Getting celebrities behind that might have convinced shoppers that doing the right thing was worth paying for.

Whatever you think about Charney, he did create an enviable brand and help promote the image of the Silver Lake hipster/sex kitten to the rest of the world long before Los Angeles became the newest cultural capital.

It was always a point of pride when I was in Paris at Fashion Week to walk by the American Apparel store in Saint Germain des Pres, the brash Los Angeles upstart come to the land of haute couture with an image of seduction every bit as potent as anything to come out of a big fashion house.

As shocking as they could be, Charney's sexually charged advertisements weren't that different from what was done by Yves Saint Laurent in the 1970s, Calvin Klein in the 1980s and Tom Ford for Gucci in the 1990s. And his voyeuristic imagery and unretouched photos presaged the selfie generation's obsession with posting photos on the Internet.

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It was quite a ride while it lasted.

For more on fashion, follow me on Twitter @Booth

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