Monthly Archives: September 2015

The ardent lines and consumer interest that once bombarded the Abercrombie and Fitch location in New York are now as antediluvian as the concept of the flip phone. (MarketWatch)

by: Tyler Chiu

09/30/15

Once upon a time, the adorning of a shirt from Abercrombie and Fitch would immediately designate you the colloquial words “cool,” “cliquey,” and “hipster.” Half a decade later, Abercrombie and Fitch is among a plethora of American-based retailers that are struggling to stay afloat in an industry where extraordinarily low clothing prices and the emergence of the e-commerce marketplace have swayed consumer behavior into a different direction. American Apparel, once endorsed by the A-List celebrity Justin Bieber, is in a state of legal and financial debacle. At 11 cents a share, the company faces the ignominious threat of being de-listed from the NYSE. (It reached a high of $15 in 2007.)

Although many of the retailers that are at the brink of extinction attribute their respective problems to executive failures and faux pas, (Dov Charney – American Apparel, Michael Jeffries – A&F) the true failure of the firm can be accredited to their collective inability to recognize and adapt to the capricious and mercurial tastes of the typical American teenager. This supposition ties into Gunther McGraths’ idea of transient advantage. The American clothing retailers’ competitive advantage, brand novelty and ability to cater to consumer tastes’, disappeared overtime as the reduction of barriers of entry and the proliferation of globalization allowed brands such as Uniqlo, Topman, Zara, Forever 21 and H&M to penetrate and dominate the market. Most importantly, the American clothing retailers never developed the inscrutable consumer relationships that kept customers loyal, which would have served as a natural barrier of competition.

In 2010, this generic grey A&F hoodie was priced at over $100 USD.

In 2011, the Justin Bieber-endorsed grey hoodie was priced at $59.99 USD.

Today, an H&M generic grey hoodie only sets back a consumer by $20 USD.

Seth Jones, a former superstar of the Western Hockey League’s (WHL) Portland Winterhawks, fends off an incoming checker in a playoff contest dating back to 2013. Both the Portland Winterhawks organization and the WHL  have been beleaguered by controversy involving irregular patterns of monetary compensation in recent years. (Getty Images)

by: Tyler Chiu

09/16/2015

Notwithstanding the ubiquitously known fact that the Western Hockey League (WHL) has notoriously skirted minimum wage laws in Canada and the US throughout its 59 year history, the league continues to operate unscathed as a profitable business entity, generating lucrative revenue from ticket sales and maintaining a relatively high profit margin through a plethora of sponsors such as Reebok-CCM, Subway and Telus. Over the past few years, nevertheless, the WHL has faced scrutiny, dealing with a child labor investigation from the Washington Department of L&I and a multitude of class action lawsuits , with one seeking over $180 million of outstanding wages.

Playing for the Swift Current Broncos from 1985-1988, Joe Sakic (pictured) eventually blossomed into a superstar. A current member of the 2015-2016 Broncos roster, who will remain unnamed, reports that he is compensated with a mere $125 biweekly (>=30 work week), which is approximately 100% less than the State of Washington’s stipulated minimum wage. (CHL)

Although the WHL deems itself as an “amateur” league, it still operates in a similar fashion to that of the NHL and other professional leagues around the world. Tickets are sold, thousands of seats are filled and revenue is generated. The players and their specialized skills are the essential aspect of the larger equation that makes the entertainment value of the on-ice product possible. This supposition holds constant at every profitable level of play. In each of these corresponding levels, the respective players’ compensation is a far cry from the current $62.50/week that a WHL player makes. At the end of the day, every for-profit business entity in society remunerates its employees with the minimum wage at the very least. Which begs the question, why is the WHL still exempt from child labor and wage laws?