When Little Italy’s American Apparel shut its doors a few weeks ago, it became Toronto’s second AA store to close (four years ago, the Church Street location packed up due to high rent prices and less-than-satisfactory business). So could this mean AA stores in Toronto are disappearing faster than the clothes on its ad models? Well, yes and no.
Despite the company’s financial woes (apparently, it barely escaped bankruptcy in 2009 when Lion Capital lent it $80-million to help meet the deadline on another $51-million loan), the College Street store was a huge risk for the company. “The area didn’t develop into a retail neighbourhood. The gamble didn’t pay off," American Apparel’s Los Angeles headquarters outlet operations manager, Luke Michalowski, told Humber College’s The Daily Planet.
And according to him, the Yonge and Dundas location is “one of the best stores in North America. We’re still going strong." Our calls to American Apparel’s Canadian offices for further comment were not returned.
However, it should be noted that when news of the near-bankruptcy first hit, Canada store sales were down 15 per cent compared to sales in the U.S., which were down three per cent. If that’s any indication of where AA might cut its losses, we could expect to see less of those semi-pornographic ads around here. Which wouldn’t necessarily be a bad thing.