Canadian activewear giant Gildan snatches up American Apparel

A ravenous glee has greeted news of the raunchy retailer’s demise, but is $26 really too much to pay for a sweatshop-free cotton T-shirt woven, dyed, cut and sewn by decently paid workers?



By the time news broke last week that Canadian activewear giant Gildan had snatched up American Apparel at a bankruptcy auction for $88 million (U.S.) – but wouldn’t be keeping its 110 stores open – Twitter lit up with snarky farewells. Now there’d be nowhere to buy a plain T for $70, chided one. In truth, a basic American Apparel T could cost $20, or maybe $26.

A certain ravenous glee has greeted the news about the designer/manufacturer/retailer’s demise on social media. But thumbing through the closing-sale racks at American Apparel’s Queen West store, where everything is marked down 70 to 90 per cent, an uneasy nostalgia wafts over me. I feel like I’m at the estate sale of a pervy deceased cousin.

Only, before this ‘cousin’ became an iconic fashion designer to millions of millennials in real life, he was making T-shirts for my fledgling apparel business. 

I was working at anti-sweatshop org the Maquila Solidarity Network (MSN) by day and running my one-woman clothing company by night. 

Pants were easy enough to churn out on the cheap Singer machine in my basement apartment kitchen. T-shirts were trickier. I needed blank ones, ready-made, that I could silkscreen at will.

If you punched “sweatshop-free blank Ts” into the interweb back then, the only thing that came up was this gritty L.A.-based online vendor called American Apparel run by ex-Montrealer Dov Charney. 

Charney sold a handful of slim, brightly coloured wholesale cotton Ts, tanks and briefs that looked nothing like the boxy white XLs pushed by Fruit of the Loom and friends.

I bought them by the caseload and sold my One Woman Army gear to joints like the Toronto Women’s Bookstore.

Then American Apparel blew up, launching a wave of airy white retail stores across the globe. Full-page ads showcasing AA’s garments on real women sweat stains, razor bumps and all got academics, marketers and feminists debating the offensiveness of AA’s amateur porn aesthetic – not to mention the fact that Charney had reportedly masturbated in front of a Jane magazine reporter. 

The “sweatshop-free, made in USA” copy in the company’s ads helped offset all the sleaze, and then the mutton-chopped Charney decided, as he told me back in 2005, that the term was “passé” and he ditched it. He kept the “Made in downtown LA” tagline.

All the while, cool kids kept pouring into American Apparel stores. 

By 2009, Charney was a finalist for Time Magazine’s 100 most influential people. But despite cladding an army of millennials in shiny leggings and high-waisted basics, 2009 was also the last year the company turned a profit. 

By 2014, American Apparel’s financials were in tatters. Charney was muscled out of his own company, reportedly over a string of sexual harassment lawsuits settled with former employees.

Pawning basics, AA could never be as cheap as, say, a made-in-Honduras Gildan shirt, which was fine at first, because AA was leagues cooler. 

But when it failed to stay fashionably ahead of cheaper joints like H&M and Topshop, sales continued to tumble.

The question remains. Is $26 really too much to pay for a cotton shirt woven, dyed, cut and sewn by decently paid workers (reportedly at double the usual L.A. garment worker rate) with health benefits and free daycare?

Now that American Apparel’s been bought by Gildan, “American Apparel will be American no longer,” wrote the L.A. Times. 

In a sense, it never was. AA’s controversial founder is, in fact, Canadian. But talk that American Apparel may now be “going Canadian,” as Fortune magazine put it, is likely off the mark, too. 

Gildan’s headquarters may be in Montreal, but it moved its factories out of Canada decades ago, and nearly 90 per cent of its 42,000 employees can be found in factories in Central America and Mexico. The only thing they still make in North America is socks.

So far, Gildan hasn’t said much about where it plans to manufacture American Apparel clothes, but American Apparel just announced that it’s laying off about 2,400 workers in Southern California. AA’s L.A.-based knitting and dying facility has already been preliminarily sold. New owner Joel Chun says he wants to hire back up to 300 AA employees, telling the press, “Experienced workers like those at American Apparel are crucial if California wants to compete with overseas rivals.” 

Now, American Apparel is owned by those very overseas-based rivals, thanks to the Gildan takeover. 

How have those overseas rivals been faring? In 2014, Gildan workers in Haiti complained that they were going hungry earning only $5.30 a day, less than the country’s legal minimum wage for piece-rate workers. That same year, some Gildan workers at the company’s Honduran operations said they were fired for associating with a union. Notably, though, four of Gildan’s factories in Honduras have since been unionized, something American Apparel always resisted.

I contacted my old boss at MSN, coordinator Lynda Yantz, for some perspective. She tells me we might be remembering American Apparel in too rosy a light. 

“American Apparel’s claim to being sweatshop-free was never entirely credible.”

She calls the announcement of  layoffs “a very bad decision for the American Apparel workers, and foolish business decision by Gildan. ‘Made in Los Angeles’ is central to American Apparel’s brand identity what would be the value of the American Apparel brand if the products were made outside the United States?”

Let’s hope somebody wiser than Charney swoops in to keep its 3,300 skilled workers busy and fairly paid, and that that company, too, offers organic and recycled-textile options. And when we’re asked to pay $26 for a T-shirt, maybe this time we won’t scoff.     

adriav@nowtoronto.com | @ecoholicnation

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