Forever 21 filed for bankruptcy for the second time, and while stores will remain open for now, the company expects to close all U.S. locations.
The company filed for Chapter 11 bankruptcy Sunday in Delaware, saying that it is starting an “orderly wind-down” and that it will hold liquidation sales at stores and is looking for a buyer for some or all assets.
The Forever 21 website will also still remain open.
Chief financial officer Brad Sell said in a statement, “We have been unable to find a sustainable path forward, given competition from foreign fast fashion companies… as well as rising costs, economic challenges impacting our core customers and evolving consumer trends.”
Locations outside of the U.S. are not affected by the bankruptcy filing as they are operated by other licensees. Authentic Brands Group owns the intellectual property of the Forever 21 brand and may license it to other companies.
Earlier this month, the company said it would close 200 locations including its corporate offices.
Forever 21 was started as Fashion 21 in Los Angeles in 1984 by husband and wife Do Won and Jin Sook Chang. The chain was popular with teens and 20-year-olds and was known for being economical and on-trend.
At one point, Forever 21 had more than 500 locations in the U.S. and 800 worldwide.
It filed for bankruptcy in 2019 and was acquired by Simon Property Group, Brookfield Property Partners and Authentic Brands Group the next year.
Authentic Brands' chief executive called the deal “probably the biggest mistake I made” in 2023.
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