Trouble for AA?

[Denis Kolar]

http://www.dailymail.co.uk/news/article-2662143/Founder-CEO-American-Apparel-Dov-Chraney-repeatedly-accused-sexual-misconduct-FIRED-board-directors.html

[sqslabs]

If anything, that's great news for AA.  That guy has made negative headlines and put a bad rap on the company for years. Then again, I'm pretty sure he's also the mastermind behind their softcore porn marketing campaign and that seems to have done pretty well for them.  Will be interesting to see where things head from here.

The bad news for AA is that their QC has went in the toilet in recent years.  I'm already shifting business away from them as I'm tired of dealing with markings, unsewn seams and whatever else they decide to ship that day.  I have a box full sitting in my office waiting to be shipped back.  I've even had shoeprints on multiple shirts in a row before. 

Shoeprints.

[Sbrem]

this is not news. If you were to look, you would find a xxx section of AA, and I'm not talking about sizes.

Steve

[alan802]

We once had an order of 144 AA shirts that had 12 or 14 rejects in it.  That's pretty huge as far as QC goes, I'm still amazed at that.  At Gildan's worst, there was a 250'ish piece job once that had about 10 rejects in it. 

[3Deep]

That's funny I use to tell my wife once I got my AA mail outs, let me check out my playboy book, didn't know if they were selling t-shirts or sex

Darryl

[tonypep]

They actually had a small booth at the Pool Show selling vintage Playboy mags

[ScreenFoo]

[In Simpsons 'comic book guy' voice]

Worst.  QC.   Ever.


From what I've run, Gildan beat them on percentage once @ around 20% rejects on a 50 shirt order.  Still amazed they pulled that off.
But AA screws up at least a shirt or two EVERY FRIGGIN ORDER.

[Stinkhorn Press]

I think it IS bad news for the company - but possibly not so much for us.
Yes, the QC is total shite. To the point that pretty much no one pushes there product (you don't, do you?). We only print on them when a customer demands that name on the label. We sigh and mark them up. Are you SURE you don't want Canvas, Next Level, Tultex....?

But I think this spells the beginning of the end for AA. As much as Dov is a *not good human* on some levels - that is a business that is half run on his views, his drive, his decisions - and for all of that, it's still working. Starting with that soup, the board better be amazingly awesome at choosing talent if they think he can be "replaced."

[Frog]

As printers, many of us would like to see them just go away.
Those interested in the rebound/success of AA, however, will hope that this changing of the guard will somehow attract a much needed cash infusion as they are sorely in debt. Was just discussing this with my adviser this morning, and it is total speculation whether they will see a turnaround, and/or whether that turnaround will occur before bankruptcy and re-organization.
A total crap shoot as an investment.

[ebscreen]

The girl says to buy stock in AA. It can only be good that they got rid of the emperor and his new clothing.
I tend to listen to her about these things nowadays. If I had listened to her about Tesla (the car, not the band) I don't think
I'd be working at the moment.

[Frog]

The girl says to buy stock in AA. It can only be good that they got rid of the emperor and his new clothing.
I tend to listen to her about these things nowadays. If I had listened to her about Tesla (the car, not the band) I don't think
I'd be working at the moment.

Yes, this can only help, but they some loans due in a few years, and new boss or not, if they have to default, they will have to re-organize and any investment is down the drain.
If you have a spare $7K, that you can afford to lose, go for it! 10,000 shares looks great on paper, but hopefully will eventually gain and do a reverse split

[DannyGruninger]

I don't like to bad mouth any company out there but aa sucks plain and simple imo.If anyone wants to see what they've cost us come look inside a storage container I have of nothing but american apparel rejects, incorrect shipments, etc from them. There was a time a few months back we received 13 orders in a row that all had issues, most major issues. Recently they shipped us around 250 hoodies that we never placed an order for nor did any of my contract clients. AA had no idea what they were, no ref or po numbers on the boxes. Oh well I do everything I can to get shirts eleswhere and also steer contract clients away as well. Too many problems for us and some of the printed merch they put out is so distasteful it's hard to support that guy.

[brandon]

I am actually really bummed about all of this. Since I relocated back to New Orleans my business model has changed and we hardly touch AA anymore but my last year on the West Coast I did notice their shipments and quality going down due to their new distro facility. From my friends there it was a nightmare getting it up and rolling and apparently from everyone on here it still sounds that way. What a shame. I do miss how awesome their shirts would discharge and not sure if this is still the case. A few years back a buddy gave me a tour of their downtown LA facility and it was amazing to say the least. Everything from a free medical facility (family included) to subsidized lunch to more than generous daily bonuses to a zillion other things that I can't remember. Just a shame people can't see that or forget they have positive messages on Gay Rights and Trans Gender issues. And for all the dudes out there complaining about the girls in the ads, just stop. You know you bookmark that website.

[Zelko-4-EVA]

their stock went up a bit over 6% after the news of the firing

after hours trading - the stock went up nearly 4%


its still lower than their 52 week high, but it looks like investors were happy. 

http://www.marketwatch.com/investing/stock/app

http://www.marketwatch.com/story/10-founders-booted-out-of-their-own-companies-2014-06-19

"By ousting Charney, American Apparel may have triggered a default event in its credit agreement, though the company said it would hold talks with lenders to waive the default. The company is working with a search firm to seek a replacement, and said it’s been promised an impressive list of candidates.

American Apparel shares jumped as much as 22% on Thursday as the news broke, but have erased most of the gains since then. They were recently trading up 5% at 67 cents a share. The debt-ridden company has posted losses and bled cash for some time, and its shares are far below their 2007 peak of close to $16 a share."