The young’s favorite retail store forever 21 might go bankrupt, the private company owns more than 800 stores; in more than 50 countries and until 2016 they were still opening stores. Unlike other stores where they close already by that time.
We think the bankruptcy is a way for the company; in order to get out of the leases and close the store at the least possible cost; which is one of the main advantages that bankruptcy process gives.
The company did not make any comments, but we can observe that young shoppers are experiencing a shift in behavior. Where they are heading towards online shopping rather than a mall shopping experience; due to all that technology advancement and easement of the process of online ordering.
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Hence the company is experiencing a hard time driving traffic through the stores. They are not the only ones alongside Aeropostale going bankrupt in 2016; but still managing to keep some stores open.
Forever 21 unlike many retailers its not owned by private equity firms or hedge funds; the owners who started the shop in LA are a married couple Do Won and Jin Sook; immigrants who are responsible for creating this huge empire; that generates annual sales of $3.4 billion and personal a net worth of $1.5 billion.