Many will have seen this store as a right of passage. Forever 21, despite its name, has been a fan favorite of teenagers and young adults alike for years. This store has seen many women worldwide transition their style form children to teenagers and then adults in a way that made fashion accessible and fun, and it is now closing its doors, leaving an entire generation wondering if the alternative stores that are left will be able to cater to their needs as well as Forever 21 did.
Post pandemic shopping has been a complicated minefield that most stores have struggled to navigate, and some have clearly not managed to stay afloat or do so in a way that made sense for them and their bottom line. Retail giants from Asia like Shein and Temu, which are some of the worst fast fashion producers and copiers in the market have taken a lot of their clientele with bargain prices and clothes that are not meant to be worn more than once.
This, combined with a few internal issues and the tariffs that would it unaffordable for them to continue to operate, has finally caused the company to make the decision to file for Chapter 11 bankruptcy, as they explain in a notice on their website “After careful deliberation, we have made the decision to file for chapter 11 bankruptcy protection under chapter 11 of the U.S. Bankruptcy Code. We are deeply grateful for the support you have shown us over the years, but rising costs and increased competition from abroad have made our current business model unsustainable.”
The closings have already started, USA Today reports that all of Forever 21‘s 354 “leased stores in the U.S. are to close by May 1,” and some already started closing in April. Before the closing a mass liquidation sale is taking place to liberate as much of the inventory as possible with all sales being finals and no returns accepted.
Jarrod Weber, global president for lifestyle at Authentic Brands, told USA Today in March “Forever 21 is one of the most recognizable names in fast fashion. It is a global brand rooted in the U.S. with a strong future ahead. Retail is changing, and like many brands, Forever 21 is adapting to create the right balance across stores, e-commerce and wholesale,”
And part of that adaptation is to close locations that no longer serve them.
The future of Forever 21 stores
The same notice on their website explained their commitment to continue operations for as long as possible and to sell their assets in a responsible fashion. As they state “In connection with the filing, we are beginning the process of closing a number of stores across the U.S. Importantly, however, our stores will remain open for the time being and we will continue to fulfill customer orders placed online. We also will continue to honor customer gift cards and store credit through and including April 15, 2025. All sales both in U.S. stores and the U.S. website are now final. Accordingly, we will no longer be accepting returns or exchanges. Additionally, at this point, we are no longer offering new gift cards or credit cards.
As part of our filing, we have requested to engage in a court-supervised marketing process for a going concern transaction or the sale of some or all of our assets. Decisions about which stores will ultimately close are ongoing, pending further discussions with landlords and potential buyers. For the most up-to-date information, please visit our store locator, and you can also find your favorite merchandise at www.forever21.com.”
Interestingly enough, the company has explained that the process will only apply to US stores. Their operations outside of the US will not be affected by this bankruptcy filing and business there will continue as usual.