Forever 21 is Never More
As Forever 21 begins “winding down its U.S. business while searching for a potential buyer for all of its remaining assets” many of us can’t help feeling a little wistful about its demise.
“On behalf of the company, I’d like to express our deep appreciation for the hard work of our dedicated employees and their commitment to our customers,” Brad Sell, chief financial officer of F21 OpCo, said in a news release. “We are also grateful for the many years of support from our partners and our loyal customers, who have allowed us to serve as a fashion industry leader and go-to retailer for generations.”
Forever 21 filed for bankruptcy protection for the second time in six years on Sunday and blamed fast-fashion e-tailers Shein and Temu for its demise. In a court filing, Stephen Coulombe, the operating company’s co-chief restructuring officer, said Forever 21 was “materially and negatively impacted” by Shein and Temu’s use of the de minimis exemption, which “undercut” its business. The exemption is a trade law loophole that has historically allowed goods valued under $800 to be shipped into the U.S. without import duties. “Despite wide-spread calls from U.S. companies and industry groups for the U.S. government to create a level playing field for U.S. retailers by closing the exemption, U.S. laws and policies have not solved the problem,” said Coulombe.
According to court records, the company will proceed with closing its remaining 350+ stores nationwide, and plans to complete all store closing sales before May 1, with many closing before April 1. Once the closing sales are complete, the Forever 21 stores will be gone, but not forgotten.
As a Vogue editor writes, “Where are the teenagers of today supposed to spend their allowance and/or wander around aimlessly eating Auntie Anne’s pretzels and getting yelled at by sales associates for coming perilously close to getting mustard on the merchandise? But then again, do I actually want Forever 21 and its fast-fashion peers to keep peddling the same semi-trendy dupes destined to end up in landfills and grow the fashion industry’s climate footprint? Not necessarily.”
As CNBC reports, Forever 21 has been seeking a buyer for several months and made contact with more than 200 potential bidders, 30 of which signed confidentiality agreements, but no viable deal has come together, court papers say. CNBC previously reported the operating company was in talks with liquidators and would have a hard time finding a buyer for its business.
Still, there may yet be a very small sliver of hope for the beleaguered fast fashion chain. The firm could still find new operators that are willing to run the business in the U.S., either now or in the future. “We are receiving lots of interest from strong brand operators and digital experts who share our vision and are ready to take the brand to the next level,” Jarrod Weber, global president of lifestyle at Authentic Brands Group, said in a statement. “Our U.S. licensee’s decision to restructure its operations does not impact Forever 21′s intellectual property or its international business. It presents an opportunity to accelerate the modernization of the brand’s distribution model, setting it up to compete and lead in fast fashion for decades to come.”
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Photo Credit: Mihai_Andritoiu / Shutterstock.com
