“They have six locations [distribution centers] within the United States and they’ve been extremely supportive of my career,” Charney said. “I’ve been doing business with them since 2002. We were able to build a massive business; we plan to collaborate on something even larger now. I’m a more seasoned manufacturer. My workers have more experience. My team has more experience now. We understand what the market needs. We understand the market dynamics like we never understood before. The imprintable market is shifting dramatically and we intend to be the premiere rapid reaction urban manufacturing operation in the world.”
TSC, which has corporate headquarters in Cincinnati, distributes T-shirts, activewear, fleece, outerwear and bags among other categories from brands such as American Apparel, Bella + Canvas, Bayside, Flexfit, New Balance and Gildan (which bought American Apparel at auction out of its second bankruptcy in a deal that closed earlier this year).
TSC currently carries T-shirts, hoodies and tanks from Los Angeles Apparel.
The distribution deal could shift the tides for Charney’s start-up, which currently counts about a dozen customers.
Charney has been attempting to rebuild a new basics business for over a year now after multiple failed attempts to buy back American Apparel following his ouster in 2014. The company said the firing was for cause, although Charney has vigorously fought his ouster in and of court arguing it was part of a coup to sell the company by its former cfo.
Los Angeles Apparel in the fall had about 40 workers in temporary South Central factory space. That number’s since ballooned to several hundred in expanded space still in South Central. Charney estimates the hiring of 300 to 500 more workers by the end of the year no doubt capitalizing on the mass layoffs earlier this year at American Apparel.
We’ve hired almost exclusively former [American Apparel] workers,” he said. “The average worker has worked with me for 12 years [and] some since ’97.”
Charney told WWD late last year the longer-term projection for the business, which was so far financed at the time with a $10 million asset-backed loan, is to get to $600 million in sales in 10 years with a market capitalization of more than $1 billion. He on Thursday declined to say where the company will end up in sales this year other than to say “we’re already clearing some healthy numbers” and “I intend to exceed the sales of the previous company [American Apparel].”
The company also has plans to eventually expand into swim, sportswear, headwear and bags in addition to developing a consumer-based business much like American Apparel.
“We’re working on it,” he said. We can only do one thing at a time but this is our first major distribution deal.”
For More on Dov Charney in WWD: