Source: 247wallst.com - Monday, December 29, 2014
According to a report in the New York Post , American Apparel Inc. (NYSEMKT: APP) has sharply reduced the time that its factories are open. The action is a sign of two things. One is that holiday demand for its products was soft. The other is that the retailer is low on cash. Wall Street has continued to lose confidence in the retailer. Its shares trade at $1.06, in the middle of extremely low 52-week range. Two years ago, they traded at $2.40. Paula Schneider was named the new chief executive. Under her, American Apparel says it will look at “strategic options,” which usually means an attempted sale. Former CEO Dov Charney has threatened to sue the company, presumably for firing him. One of the reasons American Apparel has to slow factory activity is that it is “vertically integrated.” That means a few factories in one place make merchandise that is shipped all over the world. This includes stores as far-flung as South America and Asia. The problem with the solution is high shipping costs. The company is proud of its system, but it adds extra costs: A garment worker in Bangladesh earns an average of $600 a year. An experienced American Apparel garment worker can earn $30,000+ and receive benefits such as comprehensive health care. American Apparel garments are created by motivated and fairly-paid employees who don’t just have jobs – they have careers. Our culture recognizes outstanding performance and promotes from within. Most
from Top News on RSS Feeds http://247wallst.com/retail/2014/12/29/american-apparel-cuts-factory-hours/
According to a report in the New York Post , American Apparel Inc. (NYSEMKT: APP) has sharply reduced the time that its factories are open. The action is a sign of two things. One is that holiday demand for its products was soft. The other is that the retailer is low on cash. Wall Street has continued to lose confidence in the retailer. Its shares trade at $1.06, in the middle of extremely low 52-week range. Two years ago, they traded at $2.40. Paula Schneider was named the new chief executive. Under her, American Apparel says it will look at “strategic options,” which usually means an attempted sale. Former CEO Dov Charney has threatened to sue the company, presumably for firing him. One of the reasons American Apparel has to slow factory activity is that it is “vertically integrated.” That means a few factories in one place make merchandise that is shipped all over the world. This includes stores as far-flung as South America and Asia. The problem with the solution is high shipping costs. The company is proud of its system, but it adds extra costs: A garment worker in Bangladesh earns an average of $600 a year. An experienced American Apparel garment worker can earn $30,000+ and receive benefits such as comprehensive health care. American Apparel garments are created by motivated and fairly-paid employees who don’t just have jobs – they have careers. Our culture recognizes outstanding performance and promotes from within. Mostfrom Top News on RSS Feeds http://247wallst.com/retail/2014/12/29/american-apparel-cuts-factory-hours/
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