American Apparel Inc., Los Angeles, recently announced the next phase of its strategic turnaround plan, including a redesigned fall merchandise line, about $30 million in cost-cutting initiatives and additions to its leadership team.
For the first time in the company’s history, American Apparel will unveil a new fall line focused on advanced basics, and key men’s and women’s items, later this year. “Historically, the fall season has not been a major focus for the company,” said Paula Schneider, recently appointed CEO of American Apparel. “We are beginning the process of re-merchandising the product assortment in our retail stores to increase productivity by SKU. The new styles are designed to increase revenue as we continue to evolve our product offering during this important selling season.”
In addition, the company has launched a series of cost-reduction initiatives aimed at aligning its cost structure with the headwinds of today’s highly competitive, promotional retail environment and foreign exchange markets. These initiatives are expected to reduce operating expenses by about $30 million over the next 18 months, according to the company.
Among other initiatives, cost-cutting measures will include closing underperforming retail locations to drive productivity improvements. In connection with these store closures, the company will streamline its workforce to reflect a smaller store footprint and general industry conditions. In the future, the company will look to add new stores in profitable fast-growing territories, while reducing its footprint in unprofitable and over-saturated markets.
The company also announced the hiring of Christine Olcu as general manager of global retail and Brad Gebhard as president of wholesale to help execute its global retail and wholesale turnaround strategies. Olcu will lead the company’s current retail country managers in optimizing merchandizing and sales at American Apparel’s store locations. Gebhard will serve as president of wholesale, focusing on increasing the company’s imprintable and business-to-business sales.
For more information, visit americanapparel.com. — L.M.
