No Sweat

| May 5, 2003

Buying a garment labeled ?Made in the USA? doesn?t guarantee that the item wasn?t manufactured in a sweatshop. In fact, of the 5,000 American apparel contractors ?most of which are located in Los Angeles?only six are union shops, reports Christine Triano in Whole Life Times. Half of these manufacturers have been charged with serious health and safety violations, and 60 percent have been found guilty of wage and time violations.

These alarming statistics caught the attention of the Hot Fudge Social Venture Fund, a venture capital firm investing in socially conscious enterprises, co-founded by Ben Cohen of Ben & Jerry?s Ice Cream. ?It was a direct response to the business climate that led the Hot Fudge Fund to hatch a radical business plan: to launch a unionized, worker-owned apparel manufacturing business in LA - and to turn a profit in the process,? writes Triano. That mission led to the creation of a teamX, the company that manufactures sweatX brand active wear.

In its first year of business, teamX generated about $1 million in sales?not enough to be profitable, but enough to almost break even. The company has since expanded from 20 employees to its current staff of 57. Factory workers operate top-of-the-line sewing machines and cutters that keep the air clean. Plant shifts start at 7 a.m. and end 3:30 p.m. Employees are paid overtime for any additional hours. Employees earn an average wage of $10.78 per hour plus health insurance and paid vacation, a package that ?far exceeds the industry standard.? TeamX is structured as a co-operative and has placed an eight-to-one ratio cap on executive to entry-level pay. The company expects to be in the black?projecting $3 million in profits?by the end of its second year.
?Erin Ferdinand

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