Troubled manufacturer and retailer American Apparel is hoping to reduce costs and increase production efficiency after investing in software solutions from Los Angeles based Tukatech Inc.

American Apparel is using the TUKAcad CAD software for product development and manufacturing, and the SMARTmark module for marker making processes. Tukatech has also provided American Apparel with manufacturing consulting to increase production and meet the demand of its 280 retail stores and e-commerce site.

“We have already seen savings of $4-5m annually from implementing their software and consulting services,” said Dov Charney, founder-CEO of American Apparel. He added that savings were achieved by streamlining cutting room operations, saving fabric costs, and increasing efficiency in key product development areas.

The company is now looking to extend its partnership with Tukatech in 3D virtual prototyping and 3D design.

American Apparel produces over 1m garments a week. However, with increasing demand here and abroad, in stores and on the web, there was a need to increase production efficiency.

As reported on just-style last week, the company has also warned it might go out of business within a year following an expected second quarter loss and amid mounting debts.