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Brand Story: American Apparel
IM Online Interview
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Marsha Brady
November 15, 2006

...a fast growing business...cutting to market...a reflection of the upcoming a cirqule of design, art and fotographie. it is 247...body style...feeling...super shot.

words by dov charney, founder.

American Apparel international growth rate is skyrocketing, even and especially on the european market. More than 4000 staff members, a turnover of more than 211 million dollars in 140 stores. Is it about time to slow down a bit?

Yes, and we are. It was an experimental period to see how many places we could be at once. I still don't get why the world is so shocked by this kind of growth. I'm more shocked that it doesn't happen more often. I gave a business seminar in Zurich a while back and the audience was mainly CEO's and senior executives from some of the largest companies in Europe. It was as if they were hearing a fairy tale as I explained our simple way of doing things. As I listed all the countries we'd rolled out in over the last year, they really couldn't believe it, some of them were laughing. And at the same time the cost of their suits alone would keep 10 teams of sewers paid for 8 months. In the language of their budgets, the same figure represents the production of one ad campaign, while ours cost on average 150 USD and maybe some beer. We carry product that we get essentially at cost and we don't spend money like other companies do. An Apple store, for example, can be one million dollars to build while ours average out of $150,000. So far, we have had no regrets and only about 3 misfires out of 140 stores. It has not only generated financial growth, it's also upped the quality of our human resource bank. Our employees really have a chance to show what they can do, they're not trapped by the parameters of their jobs. It is possible to expand as we have when every detail is shrewdly managed, and there is full commitment from everyone involved. Our customer was everywhere and we wanted to make it easy for them to find us because we don't believe in playing hard to get. Although there are still many places we want to be, for now what we're doing is taking care of our existing locations and making sure they mature properly.

Is there any danger the brand might be overstrained, burning the candle at both ends? Did you define a goal, some kind of a maximum expansion? Brands like gap or bennetton did see some pyrotechnics in the German and European markets, considering the fact that Europeans are known as being censorious consumers...

Every great entrepreneur works around the clock. We are a goal-oriented business. We work from spreadsheets constantly, analyzing our data and looking for ways to make the numbers tell us more so we can refine how we do things. Our expansion may have seemed chaotic, but when we get 100 emails a week from people begging us to open a store in a certain city, it's bad business not to if the financing is there. We listen to our customers when they tell us what they want. We listen to our employees when they tell us that it would be great if we made a certain item. But this is also balanced with careful consideration, and this is how we decide what we can and cannot do. I would love to tell you that we're just a lucky company with great product, but we are a dedicated lot who work 24 hours a day to keep on top of everything. It's just how we do it. When we feel our balance is beginning to sway, we respond immediately. Our response time is faster because all points of our operation occur at our factory in Downtown Los Angeles where we have full technical visibility on all of our stores globally.

It's been said that the European customer is very critical, and I would agree. It's very true. But there is something that they are responding to in us, and I sincerely believe it's the lack of pretence in our brand.

Right from the very beginning there was a certain "hip bonus" for American Apparal: clean, puristic design, no logo, and especially "nice and real people" - an image which was readily accepted by a lot of people.

Coincidence or strategy? Where and how do you define your marketing goals?

Is there an option for the national markets or even single stores to act independently, and to what extent?

We were a bit lucky on the timing with the popularity of "No Logo". It was when we opened our first store, which was actually intended as an art gallery. We just put a rack of t-shirts out to see if anyone would buy them. They sold out in under an hour. The hipsters were onto us and that was primarily because of the design and manner in which the product got out. At the time we were wholesalers and everyone was printing on our shirts from indie bands to church groups so the fit was already known for being the best. Getting our t-shirts with nothing printed on them was a who-do-you-know-with-a-wholesale-account kind of situation, and it wasn't easy to get an AA blank. Our ad imagery has changed quite a bit from the early days, when we were more focused on the ethical aspect of things. We're interested in social concerns of course, but it's foolish to think that that is the first thing on a girl's mind when she's buying a bathing suit or a pair of underwear. So we moved on from placing that as our primary message. We just shoot what is around us, people, things and places that hold our attention. It could be a girl or a boy, a building, a group of bicycles, or a septuagenarian couple. We just make clothes we want to wear. We discuss contemporary culture and are always debating issues of imagery. When we edit our photos, we argue out whether its sexy, the right kind of sexy, is it our kind of sexy? Our goal was and is to represent ourselves in a way that is compelling, contemporary and authentic, and it's an idea that is always evolving.

Did you come up with new, global goals.... social engagement, or a european / worldwide corporate growth strategy?

We do have plans for other parts of Europe and further development of the territories we are present in currently.

In your long-term strategy, did you think about an European headquarter other than your headoffice and manufacturing base in California? Wouldn´t such a focus on Europe even be a logical step, considering youe extension plans for this market? An European corporate design and community, that represents, translates and develops the idea of American Apparel in Europe?

Expansion may force us to set up a separate manufacturing facility, but the idea of setting up simply for a European influence really isn't necessary, as everything would have to pass through us anyway. We have offices in Montreal, Dusseldorf, London, Paris, Seoul and Tokyo. We're in constant contact with these offices as well as all of our individual stores. With email, ichat, digital cameras, and cell phones, we can transmit ideas and information from any spot on the planet, so it really doesn't matter where central command is.
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