Forever 21 Could Close Upwards of 200 Stores

Forever 21 is preparing to close even more stores nationwide as it considers filing for bankruptcy a second time, multiple reports say. The closures could total upwards of 200 stores in total.

The Los Angeles-based company has been searching for a buyer to stop bankruptcy, according to CNBC. The fashion retailer has struggled to compete with low prices offered by online retailers SHEIN (whom it partnered with in 2023) and Temu for several years.

The news outlet reports that despite the potential for bankruptcy, the company brand name is not for sale. Currently, brand management firm Authentic Brands Group owns Forever 21′s IP, while a separate entity handles the company’s overall operation.

This surprising turn of events comes after it was reported that Forever 21 faced further financial difficulties. Some stores reportedly asked their landlords to cut their rent by as much as 50% last year to help control each store’s overall costs.

If the company heads into a second bankruptcy, it would likely search for a buyer to purchase the retailer’s remaining stores. However, if no buyer emerges, Forever 21 would likely liquidate its entire chain, which currently consists of about 350 stores.

The Business of Fashion quoted a representative for Forever 21’s operations owner Catalyst Brands. They said in an email, “Forever 21’s operating company, which is the brand licensee in the U.S., continues to explore strategic options, including a potential sale, while also reducing costs and optimizing its store footprint. The efforts are ongoing and no final decisions regarding the outcome of the process have been made.”

The retailer’s struggles come after it filed for bankruptcy protection in 2019. Forever 21 was later bought by Authentic Brands Group and landlords Simon Property Group and Brookfield Property Partners.

In January 2024, Retail Dive reported that ABG CEO Jamie Salter said the Forever 21 deal was “probably the biggest mistake” of his career. “I didn’t see SHEIN and I didn’t see Temu. My partner, Mr. Simon said, ‘Why are you going partners with SHEIN? Like, you think that’s the right decision?’ I said, ‘David, it’s the right decision. We cannot beat them. Their supply chain is too good. They know what’s going on. They’ve figured this out. We need to partner with them.’”

What’s in the Future for Forever 21?

Is Forever 21 closing stores? Here's what we know as company considers bankruptcy, reports say https://t.co/GGyz37HH3g

— NorthJersey.com (@northjersey) February 20, 2025

Forever 21 stores scheduled to close will subsequently hold going-out-of-business sales, such as the Westfield Montgomery Mall location in Bethesda, Maryland. The store’s sale is expected to last two to three months, with discounts ranging from 10% to 40% off, according to The U.S. Sun.

Neil Saunders, managing director at GlobalData Retail, told NorthJersey.com of the closings, “The truth is that Forever 21 has lost any sense of personality. It has massive stores which are far too big for its needs and which are full of product that lacks an identity and is nothing special. It’s the kind of generic ‘stuff’ that many shoppers are happy to pass on, or which they can find much cheaper online.”

At one time, Forever 21 operated more than 500 locations in the United States and at least 800 worldwide. The locations of the stores being considered for closure have not yet been released.