Forever 21 Bankruptcy

Predicting the demise of Sears & Kmart since 2017!
Alpha8472
Posts: 3929
Joined: February 24th, 2009, 8:55 pm
Been thanked: 79 times
Status: Offline

Forever 21 Bankruptcy

Post by Alpha8472 »

Sales are down 20 to 25 percent and it is possible that the company may declare bankruptcy soon. They stopped adding stores around 2016. A bankruptcy may allow them to close stores and get out of leases.

This company may have over expanded. They have over 800 stores and some are over 20,000 square feet. The company has cheap quality clothes. There is nothing enticing people to come in. Abercrombie has invested in higher quality fashion to bring in the customers.

Forever 21 has not closed down underperforming stores. It is behind in the times.
pseudo3d
Posts: 3852
Joined: November 12th, 2015, 7:01 pm
Has thanked: 5 times
Been thanked: 77 times
Status: Offline

Re: Forever 21 Bankruptcy

Post by pseudo3d »

Their Mervyn's stores, which approach some 70k square feet, are probably among the biggest. They also opened big stores in high rent areas, like New York City with a 90k square foot flagship in the former Virgin Megastore (and some other space). All those spaces are way too big (always have been) for a place that just sells clothes. Even Mervyn's had some other departments (housewares, etc.) in their stores.
Alpha8472
Posts: 3929
Joined: February 24th, 2009, 8:55 pm
Been thanked: 79 times
Status: Offline

Re: Forever 21 Bankruptcy

Post by Alpha8472 »

I totally forgot about those huge Mervyn's stores. Why did Forever 21 choose such huge stores? They do not even have enough clothing to fill all that space. Do they even sell mens clothing?

I noticed that they seem to love 2 story stores as well. They used to have a small mall store near me, but they built a brand new 2 story store and attached it to the mall. It was way too extravagant for a Forever 21 with escalators, marble floors, and chandeliers. The company was just wasting money on absurd stuff.

Then they opened up another 2 story store one city over in a high priced crowded downtown area with no parking garage. Now they wonder why that store is doing virtually no business.
storewanderer
Posts: 14379
Joined: February 23rd, 2009, 3:54 pm
Has thanked: 2 times
Been thanked: 298 times
Contact:
Status: Offline

Re: Forever 21 Bankruptcy

Post by storewanderer »

They have (had) some former Gottschalks too which were quite large. Modesto was a 3 floor former Weinstocks... Yuba City was a smaller one floor place but it was still much too big. They didn't really remodel and the stores still looked like Gottschalks inside.

They just (in the past couple months) opened a new store in Reno and I am really confused why they did that. But it is not unusual for last gasp chains about to go under to open a few new stores right toward the end.

Also went into one of these in downtown Seattle that was at least 3 floors and it was messy and not well merchandised at all. Honestly on the top level someone could have died up there and I'm not sure when anyone would have noticed it was so dead.

This is a chain that I am not surprised to see is having trouble. They opened stores too large, their customer focus was too narrow, and they have not maintained their stores well.
J-Man
Personnel Manager
Personnel Manager
Posts: 296
Joined: April 10th, 2011, 4:14 pm
Been thanked: 17 times
Status: Offline

Re: Forever 21 Bankruptcy

Post by J-Man »

The one in the Westfield Santa Anita mall (Arcadia, CA) took over most of the space of a former three-story Robinson's (later Robinson's-May). It has almost as much square footage as the Nordstrom in the same mall (which was originally Buffum's.) The original Forever 21 in the mall was much smaller; it was really shocking when they expanded into such a larger space.
Super S
Posts: 2691
Joined: April 1st, 2009, 9:27 pm
Has thanked: 11 times
Been thanked: 61 times
Status: Offline

Re: Forever 21 Bankruptcy

Post by Super S »

Alpha8472 wrote: August 30th, 2019, 11:54 am I totally forgot about those huge Mervyn's stores. Why did Forever 21 choose such huge stores? They do not even have enough clothing to fill all that space. Do they even sell mens clothing?

I noticed that they seem to love 2 story stores as well. They used to have a small mall store near me, but they built a brand new 2 story store and attached it to the mall. It was way too extravagant for a Forever 21 with escalators, marble floors, and chandeliers. The company was just wasting money on absurd stuff.

Then they opened up another 2 story store one city over in a high priced crowded downtown area with no parking garage. Now they wonder why that store is doing virtually no business.
They took over part of a former Mervyn's at Olympia's Capital Mall, which ended up closing about a year ago. The remaining space is divided between an REI store and a Total Wine store. I think a shoe store of some sort is now in the Forever 21 space.

I am a male so am not their target customer, but their stores were very inconsistent from what I have seen just walking by them in various malls.
pseudo3d
Posts: 3852
Joined: November 12th, 2015, 7:01 pm
Has thanked: 5 times
Been thanked: 77 times
Status: Offline

Re: Forever 21 Bankruptcy

Post by pseudo3d »

Alpha8472 wrote: August 30th, 2019, 11:54 am I totally forgot about those huge Mervyn's stores. Why did Forever 21 choose such huge stores? They do not even have enough clothing to fill all that space. Do they even sell mens clothing?

I noticed that they seem to love 2 story stores as well. They used to have a small mall store near me, but they built a brand new 2 story store and attached it to the mall. It was way too extravagant for a Forever 21 with escalators, marble floors, and chandeliers. The company was just wasting money on absurd stuff.

Then they opened up another 2 story store one city over in a high priced crowded downtown area with no parking garage. Now they wonder why that store is doing virtually no business.
I think they do sell mens clothing in larger stores, but even so, the idea of massive stores with only clothing is unfeasible (just ask Steve & Barry's). As for escalators, I noticed that in the former Borders in The Galleria (itself recycled from a portion of Lord & Taylor) they replaced the former spiral staircase in the middle of the store (it wasn't a true spiral staircase, just with lots of angled landings) with escalators. Seemed a bit excessive for what was essentially a large in-line store.
Super S
Posts: 2691
Joined: April 1st, 2009, 9:27 pm
Has thanked: 11 times
Been thanked: 61 times
Status: Offline

Re: Forever 21 Bankruptcy

Post by Super S »

In some ways these stores seem to be trying to be like H&M which is a similar store. Some locations such as Southcenter take up two levels and have escalators despite not being a main anchor. Others are an inline smaller store. It's anothe rone of those stores I don't exactly understand the appeal of, but I guess a new name will draw business and boost foot traffic at least for a while.

It is worth noting that the company also started a beauty type of store called Riley Rose which has a location in Southcenter, and looks like they were trying to get a share of the business of places like Ulta, Sephora, etc.
Bagels
Assistant Store Manager
Assistant Store Manager
Posts: 823
Joined: August 20th, 2018, 11:54 pm
Has thanked: 1 time
Been thanked: 12 times
Status: Offline

Re: Forever 21 Bankruptcy

Post by Bagels »

There was a pretty good article about their demise in the LA Times earlier this summer. Apparently, as the chain expanded into larger stores and began expanding its product assortment, its primary audience soured. Apparently, 17-year-old girls (a) don't want to shop at a large store and (b) don't want to shop at a store that also caters to plus-sized girls, moms and dads, etc. Additionally, there's been a rise in e-retailers that can copy celebrity fashion in just two weeks (from design -> production -> inventory) whereas F21's physical presence needed longer lead time.

Apparently, F21 has been quietly renegotiating leases and shrinking/moving into smaller spaces. Most analysts think they'll close their large format stores -- from the former Mervyn's to the mall anchors (Mission Viejo, Las Vegas, etc.) in the short-term... and everything else in the long-term.
J-Man
Personnel Manager
Personnel Manager
Posts: 296
Joined: April 10th, 2011, 4:14 pm
Been thanked: 17 times
Status: Offline

Re: Forever 21 Bankruptcy

Post by J-Man »

Post Reply