Dov Charney Sheds Light on His Next Act

Dov Charney’s past couple of years have been pretty wild, to say the least. The ex-CEO of American Apparel was fired from the company he founded back in 2014 in the wake of “sexual harassment suits, physical abuse towards his managers, and even scrutiny from immigration officials over irregularities in his employees’ work documents.” Perhaps unsurprisingly, Charney sought $40 million USD in damages, ultimately losing out as the company filed for a restraining order against him. Then, somehow, for a brief moment, it looked like Charney might find his way back to the helm of American Apparel before he and his unnamed investor’s $200 million USD bid was ultimately rejected in favor of a Charney-free reorganization following AA’s October 2015 bankruptcy.

Now Charney is back with a new, yet-to-be-named, Los Angeles-based venture that will pay homage to The City of Angels with American-made basics for men and women (sound familiar?). As Charney gets set for his second act, The Business of Fashion sat down with the man himself as he shed light on “what went wrong at American Apparel, his attempts to wrestle back control of the company he built and what he plans to do next.”

Check out some of Charney’s thoughts from the piece below and head on over to The Business of Fashion‘s website to read the story in its entirety.

On what form his new venture will take:
We plan to sell as a stockist [to the] screen printing industry. And, secondarily, to consumers, through an online store, which we don’t have established yet. And through a number of bricks and mortar stores. We might do a number of different brands… We’re already selling it, but only to close companies that are keeping it under wraps. We’re generating some sales but it’s all beta testing; 5,000-piece orders.

On the initial rise of American Apparel:
My photographic aesthetic won over the contrived aesthetic. I used to call [traditional advertising] the dead look. What is she doing? If someone has a Hasselblad [camera] pointed at you, you’re not doing this. I created a new aesthetic. Challenged norms. Challenged perceptions of beauty. [American Apparel] was designed for well-educated consumers. It wasn’t designed for the suburbs. It’s kind of unfortunate that I lost control of what I had. But worse things have happened. My ancestors were slaughtered in front of their homes. What did I lose? Like, a company? Okay? Start another company, kid.

On doing “buy now, wear now” and “see now, buy now” long before the terms had been coined:
I don’t believe in fast fashion. If it’s a good running shoe or a good t-shirt… it should last four or five years. Do you have to have a new iPhone every year? Not really. Some people are really comfortable with an [iPhone] 5. They were trying to fool the consumer with a new Cadillac every year. But European design… Mercedes 190, 300, some of the classics in Europe — it was about something that could last for a while. You’re buying into value. Of course you want a new one from time to time, but they’re not building in this obsolescence. The [apparel industry] built in obsolescence.

On offshoring:
You go behind the curtains, and everyone is in this 20-cent sweatshop. It’s not even fashionable. It’s unfashionable. Kids wouldn’t even buy clothes if they knew how they’re made. It’s too ugly. It’s not fun. It’s not even cool. The artists behind these brands are sustaining apartheid of sorts… Here are some solutions: bring the manufacturing back into the corporation instead of all these brands giving the work to Li & Fung. They have these monolithic manufacturing companies that are completely just disjointed and separated from the design guys, you know? Designed in California but made in whatever. Apple tried to pull this… I’m not saying there aren’t cheap wages [overseas], but the cost of markdowns is too high.

On his ousting from American Apparel:
In 10 years, I generated five billion [dollars] in sales and over 2.5 billion dollars in gross profits and a quarter of a billion dollars in EBIDTA (earnings before interest, taxes, depreciation and amortisation). The company hit its height in sales on the cusp of my illegal ousting, which violated principles of corporate democracy. It was a fascist play. It was a crime — a securities crime being investigated by the government right now.

On the beginning of American Apparel’s downfall:
The point when we lost was the immigration. We had to borrow a lot of money to keep rolling with all that debt. It was not a raid. It was an I-9 audit by the government. We were found to be compliant with all immigration laws, but we had to let go and rehire thousands of people. This was the only challenge. Otherwise, this was one of the greatest brands that came out of the US in a decade, or multiple decades. It was a fantastic brand. Sure, there were ups and downs. But we could’ve continued going.

On American Apparel’s future:
The business is dead now. It’s gone. It will never come back. It is not going to resurrect. It’s not going to have a happy ending. They destroyed it.