Made in America: The ‘World’s Best Hoodie’

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Dec. 27 (Bloomberg) -- Bayard Winthrop, CEO of American Giant, discusses manufacturing in the U.S. and what differentiates his company’s apparel from competitors. He speaks on Bloomberg Television's “Market Makers.” (Source: Bloomberg)

Investment banking, you didn't -- you then worked in manufacturing, and then use the -- then he wanted to make the world's greatest hoodie.

There is a retail dirty secret, the vast majority of what you're paying for is unrelated to the manufacturing process.

I felt there was a real opportunity to eliminate those and build a great run it and keep the price reasonable for great american may gloats -- for great american made clothes.

I know you take great pride in the craftsmanship of this product, but what gets american giant -- what sets american giant away from american apparel?

With the apparel industry and a lot of other businesses, when you get into the business of rolling out lots of retail stores or layering and resellers between you and the customer, you are adding layers of cost.

Any business that is deciding to support hundreds of retail stores across the country make a decision about the business model that is going to be paying for all of that for which by then it -- definition detract from the quality.

If you think of all of those things you get a new way to approach an old problem.

But your price point is not that far off from american apparel.

We get there by selling trips to crowd -- direct to customers and best of quality.

That may be the case, but it is difficult to actually get your hands on one of these sweatshirts.

I know there's a lot of buzz around your product, but you have had a lot of trouble keeping up with demand.

Does that show the limitations of major fracturing in the u.s.? it might be as simple as downloading an app for apple, but manufacturing requires an interesting matchup between consumers that are finding out about brands, and scaling very rapidly, match it with old world manufacturing.

If someone tweets about our sweatshirt, or are close, thousands of thousands of customers can hear about it in an instant.

Then we have to make the product.

That is what different -- is what is different from our business model.

There was backorder on product for a month, but our scaling is happening really rapidly.

We hope we are getting in front of the problem.

The time it takes from ordering raw materials to making sweatshirts is about 3.5 months long.

Are you shortening that timeline?

As you get bigger and bigger your compressing that timeline.

We source all the way back to our yarn and gotten coming domestically.

You can compress those leadtimes down.

We can be to market it has little to 68 weeks going all the back -- way to the product fabric.

There is a story this week and about how textile makers are actually using -- moving to the u.s. as art of this great renaissance of american manufacturing.

Are you seeing this as a startup manufacturer in the u.s.? is it easier to manufacture goods in the u.s. than in asia?

The biggest part is labor costs.

The arming process, it is a relatively labor-light process.

When you get to the cutting and the selling of fabric, your labor costs rise.

I think you're good to see the first wave of yarning.

The cutting and sewing will come later, but as more and more pieces come back to the u.s., and bypass traditional cost of retail and reselling, even the cut and so parts of the process are going to come back as well.

How are you going to turn a hoodie into an iconic american clothing item?

You have been called the best hoodie of all time gabon -- of all time, but are you trying to get endorsements?

We're trying to build product.

The blue gene and the sweatshirt is the iconic american look.

We wanted to go back to that category.

Customers want great product at a fair price, and that has been lacking in the apparel a long time.

We believe, as we get into new categories like t-shirts them a button-down shirts, you're going to see the brand grow, and demand grow.

We are keeping that having a hard time keeping up right now,

This text has been automatically generated. It may not be 100% accurate.

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