iStock.com/zodebala
If a buyer doesn’t arrive in bankruptcy proceedings to keep some stores open, Forever 21 reportedly plans to replicate the SHEIN and Temu formula by focusing on online-only and shipping goods directly from overseas factories to consumers and retail partners.
That’s what a source told Bloomberg, noting that Authentic Brands Group, which owns Forever 21’s intellectual property, has successfully tested the factory-to-retail model outside the U.S.
Forever 21 will also continue to sell at JCPenney, which is also owned by Authentic, as well as license the brand to other operators, according to a statement.
One skeptic of the shift away from stores is Sky Canaves, an eMarketer analyst who noted that other distressed retailers, including Bed Bath & Beyond, haven’t found success as digital-only. She told Modern Retail, “Unless they are going to launch a huge marketing push or innovate with new products that can appeal to their target demographics, I don’t know how they would manage to turn the brand’s fortunes around.”
The bankruptcy, its second in five years, was attributed in large part to competition from online retailers like Temu and SHEIN that can skirt import duties and tariffs by shipping goods directly to consumers. Only 11% of Forever 21’s domestic sales were sold online last year.
Forever 21 has moved to liquidate its remaining 354 stores as it seeks a buyer. Founded in 1984, Forever 21 peaked in the early 2010s with nearly 800 global locations.
Describing Forever 21 as a “relic of the mall era,” Natalie Michie, social media and market editor at FASHION Magazine, believes the chain became too reliant on mall traffic as shopping shifted online. She wrote, “It was a dream come true for droves of teens who went to retail plazas simply to wander around. It added to the magic of meandering, an activity that has been increasingly replaced by scrolling in the digital sphere.”
Others still saw merchandise and other issues.
Visiting Forever 21’s store at 34th Street Herald Square, Samantha Grindell, a senior lifestyle reporter at Business Insider, found the store filled with graphic sweatshirts and T-shirts and lacking the affordable crop tops, low-cut tanks, and tube tops she and her girlfriends sought for the “night out” in their youth. Grindell wrote, “Forever 21 didn't find a way to grow with millennials, nor did it charm Gen Z shoppers away from easy-to-access online retailers.”
Cathaleen Chen, retail editor at The Business of Fashion (BoF), wrote that other chains similarly threatened by “ultra-fast fashion,” citing H&M, Gap, and PacSun as examples, “have done more to differentiate their product, and are investing heavily to ensure their in-store experience draws shoppers, rather than sending them to SHEIN’s app.”
Homages to the chain nonetheless arrived in Vogue, The New York Times, Slate, and elsewhere as the chain’s store closures stoked memories for many millennials who discovered fashion shopping at the chain. Hannah Holland, an MSNBC producer, wrote on MSNBC, “I shouldn’t feel a thing about Forever 21 shutting its sliding glass doors for good. But I can't help but feel nostalgia for an era of naive abundance.”