Multi-Billion-Dollar Retail Company, Forever 21, Files For Bankruptcy After Getting Beat Out By Upcoming E-Commerce Brands

Forever 21, one of the leading clothing retail companies in America, officially filed for bankruptcy as of August 29, 2019. This may come as a shock to some, but many saw this coming.

Forever 21, owned by Jin Sook and Don Chang, is a retail company with over 800 storefronts nationwide bringing in a total of $8 billion in 2017. The massive expansion of the stores seemed like a good idea to Sook, but this massive expansion was the calm before the storm. Forever 21 soon found themselves on the tail end of jokes and memes, especially throughout the teen community, a major demographic for the brand. The 400 styles being approved by Sook per day became less trendy and, according to critics, more tacky.

The diminishing retail chain was quickly losing business to similar retailers including H&M and Zara. These competitors are known for having better quality and designs for the same bargain. E-commerce also took a toll on the financial stability of Forever 21.

Forever 21 has begun downsizing their stores and is already on the way to shutting down around 100 of their current locations. They are one of the many retailers being affected by the “retail apocalypse.” While the name is pretty self-explanatory, this “apocalypse” can be further defined as the closing of brick-and-mortar or large retail stores. As a result, the owners have lost $4 billion of their personal net worth and the company has gone $500 million in debt.

What does this mean for Forever 21? Just because they filed for bankruptcy does not necessarily mean that they are closing for good. If they play their cards right, this could be an amazing opportunity for them to bounce back, rebrand, and start fresh. As of right now, cheap and trendy online fashion boutiques like Fashion Nova and Nasty Gal will take the “Forever” out of Forever 21.

Please share our stories: