Forever 21, the fast-fashion retailer that once dominated U.S. malls, is closing all of its American stores after filing for bankruptcy protection for the second time. The company cited declining mall traffic and increased online competition. According to Local10, Forever 21's Chief Financial Officer Brad Sell said, "While we have evaluated all options to best position the company for the future, we have been unable to find a sustainable path forward, given competition from foreign fast fashion companies, which have been able to take advantage of the de minimis exemption to undercut our brand on pricing and margin." While U.S. stores prepare for liquidation sales, international locations will remain open.
Once popular for trendy and affordable clothing, Forever 21’s decline coincided with a shift toward online shopping. Mall culture has been in decline as more shoppers turn to online retailers like Amazon, Temu, and Shein. In 2023, Shein acquired a one-third interest in Forever 21’s operator, Sparc Group, as reported by Local10.
Neil Saunders, managing director of GlobalData, stated, "Forever 21 was always a retailer living on borrowed time. Over recent years it has been hit with dual headwinds from a weak apparel market and stiff competition from cheap Chinese marketplaces," in a report by Local10.
Forever 21’s downfall appears to be the result of market saturation and shifting consumer preferences. Roger Beahm, a marketing professor, told NBC News, "Forever 21 was the brand that the former generation used. Today’s shoppers want their own brand, they want their own identity."
