American Apparel Continues To Struggle, Will Close Stores And Raise More Capital

American Apparel Restructuring Plans

Struggling teen clothing retailer American Apparel is closing underperforming stores and plans to raise more capital in the next 12 months as part of a new restructuring plan aimed at cutting costs.

The current board of directors at American Apparel plan to cut costs by approximately $30 million over the next 18 months. To reach their goal they will cut jobs and close underperforming stores.

While the company will close stores that are failing to attract customers, American Apparel said it will look to add new stores in profitable fast-growing territories. The company expects its restructuring initiatives to reduce operating expenses in low profit geographics, while generating increasing profits.

The company has also announced plans for a completely redesigned fall merchandise line, and key additions to its leadership team.

The fashion retailer is currently being sued by its founder and former CEO Dov Charney after he was removed from his position by his own board of directors. The defamation lawsuit is seeking more than $20 million in damages.

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Written by Peter Mondrose

Peter Mondrose

Peter Mondrose is the Editor-In-Chief at BusinessPundit. He received his degree in Economics in 1998 and a second degree in Journalism in 2004. He has served as a financial adviser, market trader, and freelance journalist for the last 11 years. When he's not investigating market conditions and reporting on workplace news, he can be found traveling with his wife, dog, and laptop. He can be reached at PeterMondrose@BusinessPundit.com or (929) 265-0240.