LOS ANGELES (CBSLA.com) — Struggling teen clothing retailer American Apparel will cut jobs and shut down stores in a $30 million cost-cutting effort, according to reports Monday.
The downtown Los Angeles-based company is expected to launch a restructuring plan to trim costs despite warnings that funding requirements could fall short over the next year, Reuters news service reported.
Since 2010, American Apparel has posted successive annual losses and saw its market value plunge from $540 million to about $90 million, according to Reuters.
The company, which has about 10,000 employees, announced about 200 layoffs in April, with a majority of the job losses coming from the company’s manufacturing operations in Southern California.
“We are committed to turning this company around. Today’s announcements are necessary steps to help American Apparel adapt to headwinds in the retail industry, preserve jobs for the overwhelming majority of our 10,000 employees, and return the business to long-term profitability,” said CEO Paula Schneider.
Last year, American Apparel fired founder Dov Charney and named longtime fashion executive Schneider as its next CEO, citing allegations of misconduct.
Officials did not disclose how many jobs would be cut or the number of planned store closings for the current cost-cutting effort, according to Reuters.
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