Forever 21 is on the verge of bankruptcy again due to competition and lower attendance
Kyiv • UNN
Fast fashion brand Forever 21 has filed for bankruptcy for the second time in six years. The reason is a decrease in shopping center visitors and growing competition from online stores.
Forever 21 may be one step closer to ceasing operations in the US after the brand's operating company filed for bankruptcy. The application is related to fewer shopping center visitors and increased competition.
UNN reports with reference to the BBC and The New York Times.
For the second time in six years, the American fast fashion store Forever 21 has declared bankruptcy. In a statement, the company justifies this step by reducing the number of visitors to shopping centers and increasing competition from online stores.
We were unable to find a sustainable way forward, given competition from foreign fast fashion companies... as well as rising costs, economic problems affecting our core customers
The management of Forever 21 stated that it will conduct a liquidation sale in its stores. Part or all of its assets will be sold in a court-supervised process.
If the sale is successful, the company may abandon the complete curtailment of operations
Reference
Forever 21 was founded in 1984 and, like other fast fashion store chains, was particularly popular among young shoppers in the mid-nineties and early 2000s.
It is believed that Forever 21 was once a "favorite" of young women around the world. It is now difficult to attract customers due to the popularity of online shopping.
The company first filed for bankruptcy protection in 2019.
It was then acquired by a consortium of companies, including Authentic Brands Group and shopping center owners Simon Property Group and Brookfield Property Partners.
Addition
According to documents filed in Delaware court, Forever 21's assets are valued at $100-500 million. The New York Times reports debts of between one and five billion dollars.
