Forever 21, a mall staple, was once among America's fastest-growing fashion retailers. Please read below to discover what led to the brand's downfall and near bankruptcy.
At its peak, Forever 21 made $4.4 billion in revenue and made its founders, South Korean immigrants Jin Sook and Do Won "Don" Chang, billionaires.
In 1981, Jin Sook and Do Won "Don" Chang moved to Los Angeles from South Korea with no money, no college degrees, and speaking little English.
Three years later, with $11,000 in savings, the Changs opened a clothing store called Fashion 21. The couple took advantage of wholesale closeouts to buy merchandise from manufacturers at a discount.
They eventually changed the name to Forever 21 to emphasize the idea that it was "for anyone who wants to be trendy, fresh and young in spirit."
They were the first to sell trendy clothing for low prices.
Forever 21 became one of the largest tenants of American malls, with 480 locations.
The Changs became one of America's wealthiest couples, with a combined net worth estimated $5.9 billion in March 2015.
Forever 21 lost touch with its core customers, while competitors like H&M rose.
Traditional retailers like Forever 21 have struggled to adapt to changing consumer behaviors. Millennials make 60% of their purchases online.
Yet, Forever 21 continued opening new stores as recently as 2016. Sales are estimated
to have dropped by 20% to 25% in 2018.
The company overall is now $500 million in debt and considering filing for bankruptcy.
Forever 21 has already started downsizing its stores.
But bankruptcy doesn't always mean the end for a company. In fact, it could give Forever 21 time to restructure and bounce back.
The company could shut down its least profitable stores and try rebranding itself.
But in an age of cheap internet boutiques and fast-fashion empires, this might not be enough. It turns out, Forever 21 might not be forever after all.