“People didn’t believe in Amazon for many years, but it ended up changing the way Americans shop,” he says. “People didn’t believe in Apple — they thought it was a fringe computer company, but it ended up changing the way people listen to music, and changing what daily life feels like worldwide.”

Given that Charney has made it abundantly clear that he won’t be leaving his leadership role at American Apparel, we can infer that he sees himself as the Jeff Bezos or Steve Jobs of the clothing industry.

Well, all of the companies start with the letter A, but that’s as far as we got with the comparison. While we’re pretty sure it will be some time before you see illustrated nudes pitching Apple, the latest investors to save American Apparel from bankruptcy are confident in Charney as head of the company, and the company’s less controversial practices.

A representative from Essentia Equity, one of the Canadian companies who injected capital into the company, cited a weak US dollar, rising Chinese labor costs and increasing transportation costs as reasons why they invested in the company, one of the few American mass market retailers who still manufactures the bulk of their products in the US.

American Apparel’s Los Angeles factory has reportedly recovered most of the productivity it lost after forced layoffs after an mmigration violation. If nothing else, this seems to be consistent with what Charney told us last year, when he insisted that the company would continue to hire in spite of financial challenges.

With the sexual harassment allegations that repeatedly arise against Charney, the provocative ads that define the company, and the repeated brushes with bankruptcy it’s easy to write American Apparel off. As we’ve noted, to do so would mean the loss of some good business practices as well though. We’re not sure if American Apparel is the next Amazon or Apple, we’re definitely not sure about Charney as the next Steve Jobs or Jeff Bezos; but the economic conditions noted by Essentia are real, and Charney’s determination remains solid. Whether that will be enough for American Apparel to capitalize on remains to be seen.

While the LA Times reports Charney as saying the possibility of the company filing for bankruptcy protection were “not even a 1-in-1,000 chance,” many observers are wondering how much more the company can take before being forced to do so. Charney recently put his own money into the company, purchasing 6 million shares. There are 79 million shares of American Apparel available, and the purchase brought Charney’s portion up from 41 million to 44 million. The remaining 3 million won’t be released until the share price hits $3.50. {Styleite}

American Apparel stock is currently trading at $0.90 per share.

American Express has threatened to de-list American Apparel numerous times, so one option might be for Charney to take the company private, and that choice may be made for him. Even if the company is removed from public exchanges, that may not be enough to prevent the company from having to go into bankruptcy. Though the $250 million sexual harassment suit filed by Irene Morales looks like it may end up being resolved through binding arbitration, the mounting allegations will cost money to defend. Throw in the rising cost of cotton and natural fiber textiles with years of declining sales, and it’s difficult to see a way for the company to continue as a going concern.

Those who don’t care for Dov Charney, or the sexually charged company culture, may not view that as a problem, but there are aspects of the American Apparel model that would leave a significant void.

Living Wages

When asked on the Today Show why she would continue working with a boss who allegedly forced her into sexually abusive acts, Morales says “I’d gone out and looked for other jobs, but nothing was as good paying… the wages of American Apparel were pretty decent.”

Most people would not consider enduring a hostile work environment a fair trade for retail wages – even “decent” ones, but one thing that can’t be ignored is American Apparel’s policy of paying above average wages to employees from the factory level to the retail floor. $12/hour versus $8/hour may not seem like an enormous amount, but for an employee who works 40 hours a week on an annual basis it’s a $7,680 difference. Larger stores with more stable sales and profits almost uniformly stick to the minimum, and keep that $7,600 for themselves.

With their very public financial troubles, few retailers are looking to American Apparel for guidance on matters like the wages paid to employees. A bankruptcy would likely see underperforming stores shuttered, and possibly well-performing stores also. In those markets, that takes away one of the few options a retail employee has for earning more than minimum wage.

American Manufacturing

Made in USA ad, courtesy of American Apparel

The company has pinned part of their problems on an immigration inspection that forced them to layoff manufacturing workers who had discrepancies in work records, or appeared to not be eligible for legal employment in the US. When we spoke with Charney last year, he told us that in business terms that meant not being able to respond to trends and changes as quickly, presumably because many of those who were laid off were more skilled garment workers.

Though they came under investigation, there have been no findings of wrongdoing by US Immigration. Charney is outspoken in his support of a path to legalization for undocumented workers who’ve been working and paying taxes in the US. Whether you agree or disagree with his stance, the larger point is that American Apparel is one of the few clothing companies that provides American manufacturing jobs – at above average wages, as well.

In a time where very few American designers and brands at any end of the price spectrum actually make their garments in the United States, losing American Apparel would mean losing one of the few fashion companies that creates American jobs at every end of the supply chain.

Diverse Models

Forget the strange illustrations that don’t include any clothes (or models). Long before it became fashionable as a way to tap into the growing Asian market, American Apparel ads were one of the few places where seeing an Asian face was fairly common. Hispanic models are also featured regularly in ads and on the website, and though there is a noticeable dearth of Black models, you can generally find more diversity in a single American Apparel campaign than an entire issue of some major magazines.

It’s not just diversity in ethnicity; browsing the American Apparel site you’ll find models who appear a bit shorter than the typical model, not as thin, and seemingly not photoshopped into an unrecognizable state.

American Apparel’s claims that all models are actual employees has been challenged before, but even if the people you see are hired specifically to model for the company, they represent a somewhat more unvarnished view of what it means to be sexy or stylish.

That in no way makes it acceptable for those women to be subjected to harassment or unwanted sexual advances in exchange for their turn in front of the camera. As well documented as the complaints against Charney are, however, he is certainly not the first man in fashion to repeatedly come under scrutiny for pressuring models into sexually charged situations. Equal opportunity does not grant any free passes for perversion, but at a time when the calls for more diversity in advertising (and let’s be honest, runway shows are largely advertising at this point) are growing louder, losing American Apparel would mean losing one of the few companies that seems to be listening. Even if it’s in a tone-deaf way.

Olivier Zahm, who often works with Terry Richardson, kissing Kimbra Lo, who is now suing Dov Charney for sexual harassment.

In a show of support for embattled American Apparel CEO Dov Charney, we’ve recently learned from sources in Paris that Terry Richardson will lead photography on an all American Apparel issue of Olivier Zahm’s Purple magazine.

Charney has been in the news for a string of lawsuits from former employees alleging sexual harassment. The women are all represented by the same attorney, and have recently come under fire themselves after nude photos and sexually explicit emails surfaced. While a woman having nude photos does not mean she can’t be sexually harassed, or specifically that Charney did not sexually harass any of the former employees, it has called their claims into doubt. {Fashionista}

Terry Richardson is no stranger to allegations of sexual harassment himself, and most recently is reported to have chatted with a part-time model telling her that everyone in fashion is a “pervert,” and that her refusal to trade sexual favors for fame would hinder her career. {Jezebel}

Then there’s Olivier Zahm: Fashionista reports that at some point Zahm dated one of Charney’s accusers. Since Zahm regularly posts nude and sexually suggestive photos of models and the women he is dating on Purple Diary, the blog of Purple, this seems to be accurate. He’s removed pages containing photos of him and Kimbra Lo, one of the former employees suing, but the photo above is from a screen capture of cached pages if you’re interested in the (fairly tame) image of the two kissing.

The allegations surrounding Richardson haven’t harmed his career, and Purple is just one of many magazines that he continues to shoot for.

Now, a source who wishes to remain unnamed has told us that the trio will team up for an issue of Purple shot entirely by Richardson, featuring only American Apparel clothing. Richardson and Charney will be jointly responsible for model casting, but from what we hear the models will be selected from current American Apparel employees.

With the personal links between these three, we guess it was only a matter of time before they teamed up officially.

We hear the issue may be delayed for release until April 1st of next year. (Hint: click the April 1st link for more information on why there may be further delays.)

Alexander McQueen Moves Forward

Goodbye Mr. McQueen, hello Ms. Burton. Long live McQueen.

Style.com covered the passing of Alexander McQueen and the showing of the final collection he designed, but something that was equally important this year was the success of Sarah Burtonâ€s first show as the new designer for the McQueen label. The passing of such a genius creative mind was indeed tragic, and the showing of McQueenâ€s last collection was a special moment, but Burtonâ€s signal that the brand can honor McQueenâ€s legacy while moving forward was absolutely stellar.

John Gallianoâ€s Dior Couture Wows

Dior haute couture was in full bloom this year when John Galliano showed his Spring 2011 collection of flower-inspired looks. The imagery and execution of the designs combined with the high, tulip-like hair of the models for a full package display of gorgeousness and perhaps our favorite moment in fashion of 2010.

Instead of sultry hipster girls wearing lame hot pants and socks, American Apparel’s latest ads feature sultry hipster cartoon girls in various states of undress. {Copyranter via Stylelite}

The hosiery ad features butt-less tights that we’re assuming is a nod to Prince’s early sartorial choices (the ad is slightly purple), and an ad which ran in VICE… well, we guess American Apparel is selling merkins or eyebrow merkins now.

As controversial as some of their early ads were, we could see some segment of the population finding them appealing. These on the other hand… we’re not sure exactly what they’re selling, and we’re really not sure if anyone’s buying.

While he defends the practice of using photos as part of store hiring decisions, Dov Charney insists that American Apparel isn’t checking out anything more than they should (personal style and presentation) when it comes to photo submissions. And you know – he’s believable, even if we don’t agree with the practice 100%.

Nearly all jobs – particularly retail, have uniforms or appearance standards. And while demeanor, experience and other qualities might be bigger concerns if you were responsible for hiring someone, the fact is that style matters. That’s not to say that the policy isn’t extremely superficial – it is. But Charney challenges, if you’re running a business based on appearances, shouldn’t the superficial things play a role?

For more than an hour, we spoke with the American Apparel CEO about the photo based hiring process, Gawker’s coverage of the matter, the company’s attitude towards plus sized shoppers, why those down sales numbers are overblown  and the trouble in trying to pin down bon goût (good taste, in French).

On Hiring Based on Appearances

The Fine Line Between Judgment and Targeting

The Business Effects

What About Those “Off Brand” Customers?

If you're used to their ads, is a head-to-toe photo hiring policy REALLY that shocking?

A new policy states that job applicants being referred by a current employee must submit a “full body head to toe” picture to the person referring them, who then passes it on to the email address work@americanapparel.net, where the photo is screened for approval, according to a transcript of an internal American Apparel conference call obtained by Gawker.

The sketchiest part is that employees transferring photos to the above e-mail address are required to do so from their personal e-mail account, not a company one. {The Cut}

A source told Gawker that in fact all prospective employees must have a full body photo taken and sent to the e-mail address to be considered for employment. The importance of the applicant’s resumé in the hiring process comes in a distant second.

Current employees are subject to this kind of body screening as well. The new policy reportedly says that in order for workers to receive a promotion or raise, their photo must be approved. Apparently, how well the person does their job is of less importance, and district employees who dislike a workerâ€s photo will refer to them as “off brand.”

American Apparel CEO Dov Charney.

When questioned about the new store policy, American Apparel Spokesman Ryan Holiday referred Gawker to the same statement issued a year ago, which said the company does not screen photos for attractiveness but to ensure an employeeâ€s personal style is a good match for their brandâ€s style. He also said current employee photos are only requested “from time to time” to be certain employees are styling themselves well in the brandâ€s clothing and showcasing their new products effectively.

There’s no word on how far up the food chain the policy extends, but with sales down, an operating loss of $17.6 million and a 41% drop in the price of shares, perhaps it’s time to consider a hiring process that’s based more on substance than style. {LA Times}

It’s a disgusting policy – and particularly rich when you see founder Dov Charney’s photos and realize he probably wouldn’t make the cut, but is likely behind the criteria that deem other people attractive enough to hold a position. And while repulsive, it’s not illegal in the United States so long as attractiveness as a hiring qualification is not based on race, gender or another protected class.
In fairness, American Apparel might be unfairly targeted just because they happened to get caught. While this is a more in your face case, Abercrombie & Fitch has come under fire for similar hiring practices in the past, and each incident brings tales of retail workers who’ve experienced some level of appearance based criticism during their career. Our guess is that tons of stores hire and fire based on appearance. Perhaps they could give American Apparel lessons in doing it more discreetly.

Kiss Nails feels your pain. For $5, you can now buy fake, stick-on nails at Target that change into every color under the sun! Really – the sunlight changes the nail color and design. {Nylon} And if you find you don’t like them, no worries — warm water takes them right off.

American Apparel is in on the color fun, too. A little pricier than the nails, they’ve put $28 thermochromatic jerseys on the racks, which for any children of the 80s will be a familiar throwback to the Hypercolor t-shirts that everyone used to want. Same concept — go in the sun, watch the color change. Kind of like a mood ring, except it’s not based on your mood. Although neither are mood rings. Hate to break it to you.

So for all you indecisive folk, you’re in luck!