Fashion retailer Forever 21 files for bankruptcy

This past weekend, teenager and young adults brand retailer Forever 21 filed for Chapter 11 bankruptcy.

According to a report by Reuters, The company lists both assets and liabilities in the range of $1 billion to $10 billion, according to the court filing in the US Bankruptcy Court for the District of Delaware.

It added that the company plans to close most of its international locations in Asia and Europe, but will continue operations in Mexico and Latin America.

Euromonitor International, a market research provider noted in a comment that US fashion retailers’ have difficulties to adapt to the new way young consumers shop for fashion.

 Nina Marston and Irina Ivanilova, Beauty & Fashion Analysts at Euromonitor International said in a statement: "Once a favourite among teenagers and young adults, Forever21 has been struggling for a while to maintain its appeal. The news of their bankruptcy today comes after that of Barney’s Department stores last month, and is symptomatic of the US fashion retailers’ difficulties to adapt to the new way young consumers shop for fashion."

"For example, Euromonitor International Lifestyle Survey indicates that 29% American consumers aged less than 29 regularly buy apparel and footwear on a smartphone, while 35% of such consumers research apparel and footwear online before buying it."  

Marston added that it’s not only about going online, but about striking a balance between the physical and digital worlds, and offering seamless customer experience and brand engagement across platforms and devices.

Written by: Gabriella Steyn.

Guzzle Media