Low-price fashion chain Forever 21 has filed for Chapter 11 bankruptcy protection. The brand has fallen victim to evolving consumer buying habits and its own rapid expansion.
A privately held company, Forever 21 will close up to 178 stores, and place its focus on improving the value of its US locations.
Forever 21 isn’t the only retail fashion chain to seek bankruptcy protection recently, as it joins the ranks of Barneys New York and Diesel USA.
“Fast fashion” chains like Forever 21, H&M and Zara took off during the 2008 recession when shoppers were looking for bargain buys. But young people are now changing their purchasing patterns, opting for more sustainable, eco-friendly products and subscribing to rental services and second-hand purchasing sites.
Forever 21 took a big blow from this change in part due to their large rental spots in major malls, which are now also attracting fewer shoppers.