Forever 21 Fashion Chain Files for Chapter 11 Bankruptcy
Share
NEW YORK — Low-price fashion chain Forever 21, a once-hot destination for teen shoppers that fell victim to its own rapid expansion and changing consumer tastes, has filed for Chapter 11 bankruptcy protection.
“The decisions as to which domestic stores will be closing are ongoing, pending the outcome of continued conversations with landlords. We do, however, expect a significant number of these stores will remain open and operate as usual…” — Forever 21 statement
The privately held company based in Los Angeles said Sunday it will close up to 178 stores in the U.S. As of the bankruptcy filing, the company operated about 800 stores globally, including more than 500 stores in the U.S.The company said it would focus on maximizing the value of its U.S. stores and shutter certain international locations. Forever 21 plans to close most of its locations in Asia and Europe but will continue operating in Mexico and Latin America.
“The decisions as to which domestic stores will be closing are ongoing, pending the outcome of continued conversations with landlords,” it said in the statement. “We do, however, expect a significant number of these stores will remain open and operate as usual, and we do not expect to exit any major markets in the U.S.”
Forever 21 joins Barneys New York and Diesel USA on a growing list of retailers seeking bankruptcy protection as they battle online competitors. Others, like Payless ShoeSource and Charlotte Russe, have shut down completely.
Their Popularity Grew During the Great Recession
The numbers show the crisis facing traditional retailers. So far this year, publicly traded U.S. retailers have announced they will close 8,558 stores and open 3,446, according to the global research firm Coresight Research. That compares with 5,844 closures and 3,258 openings in all of 2018.
So far this year, publicly traded U.S. retailers have announced they will close 8,558 stores and open 3,446, according to the global research firm Coresight Research. That compares with 5,844 closures and 3,258 openings in all of 2018.
Coresight estimates the store closures could number 12,000 by the end of 2019.Forever 21 was founded in 1984 and, along with other so-called fast fashion chains like H&M and Zara, rode a wave of popularity among young customers that took off in the mid-1990s.
Their popularity grew during the Great Recession, when shoppers sought fashion bargains.
But over the last year or so, fast fashion has fallen out of style. Young customers are losing interest in throw-away clothes and are more interested in buying eco-friendly products. They’re also gravitating toward rental and online second-hand sites like Thredup, where they see clothes worn again instead of ending up in a landfill.
These trends are happening while discounters like Target have spruced up their fashion assortments, stealing away customers.
Forever 21 has also been more vulnerable than some other chains because of its large footprints in major malls, which are attracting fewer shoppers.
Trump Calls Musk’s Formation of New Party “Ridiculous” and Confusing
Politics /
2 hours ago
Fresno DUI Driver Slams Into CHP Motorcycle, Tow Truck on Highway 99
Local /
8 hours ago
Russia Downs 120 Ukrainian Drones Overnight, Defense Ministry Says
World /
9 hours ago
Israel Sends Delegation to Qatar for Gaza Talks Ahead of Netanyahu Trip to US
World /
9 hours ago
Musk Announces Forming of ‘America Party’ in Further Break From Trump
Politics /
9 hours ago
Death Toll From Texas Floods Reaches 59, Including 21 Children
News /
9 hours ago
California’s Politics Drifts Right While New York’s Leans Left
Opinion /
9 hours ago
How Trump’s ‘Big, Beautiful Bill’ Will Make China Great Again
Opinion /
1 day ago
What’s Caitlin Clark Worth to the WNBA? A Lot More Than Her $78,066 Salary.
Sports /
1 day ago
TikTok Building New Version of App Ahead of Expected US Sale, the Information Reports
TikTok is building a new version of its app for users in the United States ahead of a planned sale of the app to a group of investors, The I...
Tech /
2 hours ago
Categories
Latest
Videos

Tech /
2 hours ago
TikTok Building New Version of App Ahead of Expected US Sale, the Information Reports

World /
2 hours ago
Hamas Government Office Rejects US Accusation of Involvement in Gaza Aid Site Attack

News /
2 hours ago
Death Toll From Texas Floods Reaches 78, Trump Plans Visit

Politics /
2 hours ago
Trump Calls Musk’s Formation of New Party “Ridiculous” and Confusing

Local /
8 hours ago
Fresno DUI Driver Slams Into CHP Motorcycle, Tow Truck on Highway 99

World /
9 hours ago
Russia Downs 120 Ukrainian Drones Overnight, Defense Ministry Says

World /
9 hours ago
Israel Sends Delegation to Qatar for Gaza Talks Ahead of Netanyahu Trip to US

Video /
3 days ago