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Fast fashion sweeps the US independent brand bankruptcy crisis
In a desperate attempt to save his controversial company from bankruptcy, Dov Charney has just 18 days to turn things around. The pressure is immense, and it seems his dreams may soon be shattered.
American Apparel, once a rising star on the high street, is now facing a major crisis. Founded by the eccentric and often controversial Dov Charney, the brand was known for its minimalist designs and bold advertising. However, over the years, it has struggled with legal issues, including accusations of sexual harassment and discriminatory hiring practices.
Recently, the company came under fire for its strict employee appearance policies. Applicants were required to submit full-body photos, leading to claims of bias and discrimination. Employees were also subjected to constant scrutiny regarding their looks, including their hair, makeup, and even weight. This practice has drawn criticism from former staff, who described the hiring process as more like selecting models than employees.
The financial situation is equally dire. American Apparel is running out of time—investors are holding the reins, and if the company can’t meet its obligations by the end of the month, it could face bankruptcy. Last year, the company received a loan from London-based investor Lion Assets, but that hasn't been enough to stabilize the business. Sales have dropped, and the brand is struggling to compete with fast-fashion giants like H&M and Zara.
Charney, who still owns a significant stake in the company, remains optimistic. He claims he's working seven days a week, striving to bring the brand back to its former glory. But with so much at stake, the future of American Apparel—and Charney’s vision—remains uncertain.
Despite its controversies, the brand still has some loyal supporters. It prides itself on being “Made in America,†with all products manufactured in Los Angeles. Employees earn higher wages compared to industry standards, and the company has long been associated with creativity and individuality. However, these positives have been overshadowed by ongoing scandals and financial instability.
As the clock ticks down, the fate of American Apparel hangs in the balance. Whether it will survive or collapse depends on whether Charney can find a way to save his company before the deadline arrives.