Forever 21 planning to close 200 stores in March as part of bankruptcy process
Once a global fast-fashion powerhouse, Forever 21 is set to close at least 200 more stores in March as part of an ongoing bankruptcy process.
At its peak, the US-based retailer operated over 500 stores in the United States and at least 800 worldwide. However, Bloomberg reports that declining sales and financial struggles have led to a shrinking store base.
If no qualified buyer emerges, Forever 21 has indicated that the entirety of its approximately 350-store chain may be liquidated.
Forever 21 allegedly withheld royalties & rent payments
An employee at Forever 21 revealed that the company had frequently withheld royalty and rent payments in an effort to stay afloat.
Many of the stores set for closure have reportedly been unprofitable for years, contributing to Forever 21’s first bankruptcy filing in 2019.
Source: 313@Somerset
Singapore was not spared from its financial troubles. Forever 21 shut its last physical store in the country at 313@Somerset in June 2021, following the closure of three other outlets at Kallang Wave Mall, VivoCity, and Orchard MRT Station.
Brand seeking licensing deals
Forever 21’s trademark and intellectual property are owned by Authentic Brands, a company known for acquiring struggling retail brands and licensing them to third-party operators.
The operating company of Forever 21 which is currently undergoing bankruptcy proceedings is now a unit of Catalyst Brands, which owns JCPenney and Lucky Brand after an acquisition in January.
Previously, Forever 21 was owned by Sparc Group, a joint venture between Authentic Brands and mall owners Simon Property Group and Brookfield Properties.
According to Bloomberg, despite the bankruptcy process, Authentic Brands remains in control of Forever 21’s branding and plans to license it to other retailers and distributors to keep the name alive.
Also read: Tupperware Brands plans to declare bankruptcy as early as this week
Have news you must share? Get in touch with us via email at news@mustsharenews.com.
Featured image adapted from CNBC.
