Dov Charney at McGill
01 Apr, 2005
Known for its well-made sweatshop-free t-shirts, as well as its brutally vivid advertisements, American Apparel has been the talk of the retail world since it came onto the scene in the late 1990s. One of the most important drivers of the chain’s success is its notoriously politically-incorrect leader, Dov Charney.
A native Montrealer, Charney has become famous for his outspoken beliefs against sweatshops. Garnering much press attention, American Apparel has openly touted its fair wages policy through its often outrageous advertising.
More than 80 people filled Bronfman’s room 178 on the afternoon of March 14, anxious to catch a glimpse of one of today’s most infamous CEOs. The room was primarily filled with undergraduates, but some MBAs and professors were evident in the crowd, who were undoubtedly attracted by the shock advertising courtesy of the Shaping Tomorrow’s Organi-sational Practices (STOP) club. Students crowded the room, sitting on floors, standing across the back of the room and filling in between the rows of tables.
Most known for its heavy advertising of fair wages, Charney immediately set the tone, quickly moving into some pointed comments about his firm’s strategy. He noted that it is not about sustainability or even corporate social responsibility, but “…about efficiency. I’m sick of sustainability and social business. It’s disdainful that we’re marketing it. I’m trying to move away from it,” he said.
And move away from it he did.
Anyone who expected to hear inspiring words about business ethics left terribly disappointed. Instead, onlookers received a speech that had the distinctive tone of a business lecture.
Citing loosely-connected ex-amples from St. Urbain Bagels to Ronald Regan, Charney preached the fundamentals of capitalism and vertical-integration theory. He explained that the source of American Apparel’s competitive advantage lies in its control over product quality.
Charney explained the cost logic to producing in a high-cost country lies in investments in technology. These investments have reduced the amount of labour hours required for assembly, allowing American Apparel to compete with other firms using less expensive labour abroad.
Boasting that American Apparel has the highest output per worker in the industry, Charney explained, “We’re trying to make t-shirts like General Motors makes cars.”
Charney made no attempt to hide his strong views about overseas production. “Most apparel today is made in shit conditions,” he admonished. “I don’t want to take advantage of international labour inequalities. I’d rather be known for exploiting human potential.”
Finally, he talked adamantly about the new class of young adults-interestingly the large majority of his audience. Noting this market’s immense size of two billion consumers, he was clear that this was American Apparel’s primary demographic. He explained that an ability to connect with these consumers will further differentiate the growing t-shirt company.
“Each generation will bring a new level of idealism. We’re going to wait to be concerned with the issues that are important to this generation and work around those issues. American Apparel will be the one company that gets it,” he said.
While he claims Los Angeles as his new home, native Montrealers could not have missed the fact that he has not lost his Montreal roots, or body language for that matter. At one point while waving his arms, he joked that he remains, “a proud smoked-meat Jew.”
For more than an hour, he never missed a beat, randomly churning out lines about Manifest Destiny, cannibalism, McDonalds and even citing the 17th century philosopher, Thomas Hobbes. His only pause was to apply a bit of lip balm.
He could have seemingly continued for longer, had he not been interrupted by a question from an audience member. One question became ten, as the listeners burst forth with impatient energy.
“What would you say to people who find your ads offensive to women?” asked one student. “Fuck ‘em. I would say, ‘Fuck off,’” Charney replied. “Next question,” he continued without hesitation.
Despite the randomness of the presentation, Charney’s personality was infectious. Leading American Apparel, at least in the near future, Charney proves to critics that a self-professed pervert “can have ethics, too.”