Forever 21, America’s hottest fashion brand- Losing its Hotness.

Forever 21 once carried a tag of America’s hottest fashion brand. Off lately, we heard in the news that the chain has filed for bankruptcy in the United States of America.

Having worked with this brand and knowing it inside out & being an ardent fan of this brand, I even had the pleasure of interacting with the founders and senior leadership of the Forever 21 brand.

Let me confess that knowing the brand’s DNA, it is based on strong fundamentals, its beliefs, its purpose is all in the right place.

Forever 21 USPs (unique selling propositions) is based on 4 core pillars

  • Large collections of fashion styles
  • Limited quantities per style
  • Tomorrow’s fashion trend, today.
  • Fashion for which you don’t have to break your bank.

This concept gave birth to a term we call as “Fast Fashion”.

What is the Fast Fashion concept?

Fast fashion can be defined as cheap, trendy clothing that samples ideas from the catwalk or celebrity culture and turns them into garments in high street stores at breakneck speed.

It is a case model for the super-efficient supply chain, in turning trendy fabric into the most sought after designs and producing it in minimum lead times and shipping it on to the shelves as fast as possible with minimum lead times.

So what went wrong with Forever 21?

Fashion retailer Forever 21 has filed for Chapter 11 bankruptcy protection in the US. The company said it plans to “exit most international locations in Asia and Europe” but would continue to operate in Mexico and Latin America.

It expects to close up to 350 stores worldwide, a spokesperson said, including as many as 178 US stores.

Let me clarify here that filing for bankruptcy protection is not the same as going bust, it is a provision provided by law to corporates to relook and restructure their debts. It is like going on a strict- diet to become leaner & healthier.

Rapid expansion i.e. opening new stores in new territories led to capital erosion, a slump in sales, and competition from eCommerce and a rise in demand for cheap fashion all led to the downfall of Forever 21.


Forever 21 core promises

Forever 21, provided every teenage girl a chance to look like a fashionista without creating a hole in their pockets. Yellow-colored Forever 21 bag was the most visible shopping bag in the malls across regions.

Mind you there was no Instagram or influencers when forever21 started out.

It wasn’t a unique idea — teenage girls have always wanted to dress like their idols. But the dizzying speed at which Forever 21 could make those trends available and affordable, however, was.

The company’s specialty became known as fast fashion, and the chain grew aggressively to become a staple in American shopping malls, opening hundreds of stores and redefining what it meant to be a traditional mall anchor.


Scalability comes with problems

As they say, when you scale your business, you have to face different problems.  Problems like quality issues, keeping up with the trends, and a price promise is a herculean task to balance.

Forever 21 had roughly 450 locations by 2009, and its “cheap chic” assortment was especially popular in the aftermath of the severe recession in 2008-09. Hundreds of shoppers would line up for the grand openings of its new stores.

Check out the video wherein I had launched its first store in New Delhi, India. ( In the last frame you might get to see a glimpse of me…)

YouTube video


They kept opening more outlets, and by 2015, the Changs (founders) had a combined net worth of $5.9 billion — but that fortune has since shrunk to $1.6 billion because of Forever 21’s problems and declining valuations among similar retailer (source Forbes )

As it grew, Forever 21 expanded into menswear, children’s clothing, maternity, and plus-size apparel and cosmetics, among other items. But that made the chain looked too much like the conventional department stores.

This is where things started dwindling down for the brand.

They lost the focus and forgot the core philosophy from where they started. You cannot induce fast fashion across categories like kids, plus sizes, athleisure wear, etc. Forever 21 stretched themselves across categories.

Learning –

Focus is the most essential aspect an entrepreneur has to practice always.


Learn as to how Instagram is disrupting fast fashion, read here.


Failed to Adapt to changing consumers demand

A brand popular with millennials may not be popular with Gen Z, and it should evolve to stay ahead of the trends.

Generation Z’s apparently is looking elsewhere for clothing inspiration.

You cannot be everything to everyone, you just need to focus on targeting with a particular niche segment of consumers, who believes in your product and would ensure that you stay afloat in turbulent times.

Forever 21 core customer base was teenage girls, once they grew older, they started craving for Quality over Quantity. They would not mind paying a little extra to seek a good quality garment.

Forever 21 failed to keep up or raising its quality standards instead chose to remain a fast-fashion retailer offering cheap fashion.

Competition too tough to crack

Competition from online fashion brands like fashion nova, nasty gals gave forever 21 tough competition and is one of the main reasons for the brand’s failure. Fashion Nova, a Los Angeles-based, online-only fast-fashion retailer known for its body-hugging silhouettes, “is the new Forever 21.”

Fashion Nova relies heavily on influencer marketing — teaming up with celebrities, bloggers and others who have large online followings. It knows its shoppers: young women who want to emulate the aesthetic of the likes of the Kardashian family.

As fast fashion starts to get even cheaper with the arrival of the wildly cheap Primark in the US, other consumers are veering away from shopping cheaply, and, rather, toward shopping smartly.

Learn more about fashion forecasting, click here.

Poor Online Offering 

The design felt out of place when compared to competitors like H&M and Zara—something that modern-day consumers are no longer willing to countenance.

Family dominance

Forever 21, always remained and operated as a close family business. They had not opened up their corporate governance by exploring different options for financial inclusions into the business.

The Way forward for Forever 21

Downtimes provide the best time for self-reflection, understanding what went wrong and then coming back re-energized with full power.

“In order to take a big leap, one must take 10 steps backward”.

Knowing the founders of Forever 21 and their entrepreneurial spirits,  the brand would soon emerge in its new avatar and will once again dominate the fashion scene.


About the author:

Ritesh Mohan is a passionate retail professional with over 20 years in the Retail sector, handling some of the biggest brands in beauty, fashion and fragrances retail & FMCG sector. Ritesh has been instrumental in the growth of some of the regional brands as well in the Middle East region. He specializes in Retail management, Product development, and Brand Management, Retail Operations, Sales Management, and Franchising & Business Management. He strongly believes in empowering business owners with his wisdom & experience of around two decades in the industry.