American Apparel Begins Layoffs and Closes Stores

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American Apparel laid off 2,400 employees in its Los Angeles headquarters and manufacturing hub two months after it filed for bankruptcy protection.

USA Today reported as well that the company was acquired by Canadian-based clothing manufacturer Gildan Activewear Inc. for $88 million. Not part of the purchase however, was the remaining 110 American Apparel stores, which are being shuttered. The purchase will give Gildan global intellectual property rights to the brand.

[Related: Gildan Activewear Inc., to Acquire American Apparel for $66 million]

American Apparel is expected to remain open for the next few months, it was given a limited license by the Gildan to keep it operating.

American Apparel joins The Limited which closed all of its 250 stores earlier this month and filed for bankruptcy protection, Macy’s which closed more than 60 stores and Sears which started its second wave of closures for 2017, among others.

[Related: Major Retail Chains Closing Hundreds of Stores]

MCM Musings:  Retail is evolving rapidly as ecommerce continues to take a larger share and shopping habits change. Large store chains used to call the shots, but now it’s flipped to the consumer, who dictates how, where and when she wants to shop, and malls are no longer destinations. But even ecommerce isn’t safe these days, as pure plays fight the marketplace beast of Amazon. Offering a seamless customer experience regardless of channel and a move from product commodity to unique offerings is what will win the day.


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