But the couple had a plan. More than 8, stores in the U. The rapidly changing retail sector put too much pressure on Forever 21, and the privately held company filed for Chapter 11 bankruptcy in late September. It announced that it will cease operations in 40 countries, including Canada and Japan, and close of its stores, including in the U. Wharton marketing professor Barbara Kahn and Ludovica Cesareo , marketing professor at Lehigh University, analyzed the case on the Knowledge Wharton radio show and outlined three distinct reasons why Forever 21 failed to stay on top.
Listen to the podcast at the top of this page. That was a tactical mistake. Forever 21 expanded rapidly in a short period of time, going from outlets in seven countries to 47 in just six years.
Even as other chains were downsizing amid the retail apocalypse, Forever 21 was opening new stores as late as In their first year, the company raked in USD , in sales. Six years later their empire changed to Forever 21 had grown to over locations. By Forever 21 had opened 11 department store-sized locations scattered across the United States. They have been functioning on this model since their first store, and still do so today as their business continues to rapidly grow.
The Forever 21 brand is divided into eight sub-brands all broken up by style but housed in the same over-sized Forever 21 store ranging from sq. The average Forever 21 store is 38, sq. XXI Forever: The large flagship that typically houses all of the smaller labels under the Forever 21 umbrella. Forever 21 Girls: A transformation of the original XXI Forever brand to be more suited towards a younger pre-teen audience. This line focuses on popular designs specific to the emerging pre-teen market and sizes.
Love21 Contemporary: A contemporary line for women offered at the same price point as the rest of the Forever 21 brands.
This line is aimed at buyers aged over 21 allowing them to continue staying up-to-date on the latest trends while remaining age appropriate. This line allows more curvaceous women to wear the same clothes as the rest of Forever 21 shoppers at the same price point.
Gadzooks: Acquired by Forever 21 in The clothing line sells casual clothing, accessories and shoes for 16 to 22 year old women. The designs follow the female models in the other Forever 21 stores of remaining on point and up to date with current male fashion trends. Heritage This particular line is an attempt by the brand to penetrate the mid-market of consumers.
With a more urban feel, this line lends itself to competing less with the big name fashion houses and their designs, but what one would find at Urban Outfitters.
Most studies only include one dimension. However, this study integrates other recommendations and gives some more suggestions available for fast fashion brands. Relevant studies have evolved with the development history of fast fashion industry, from its birth, its peak to its fall.
China has experienced a boom in fashion industry from to Early work has focused on understanding the mode behind fast fashion. An article written in praised ZARA for its innovation and quick response. Fast fashion brands like ZARA learned fashion trends fast and produced garments mimicking a top-class design but reasonable price in two weeks because of its strategy to manufacture within the Inditex Group Xiao, Later in , another study focused on SPA business mode and pointed out its core value, i.
The article reviewed the rise of fast fashion as a product of the proliferation of fast-food culture Yang, Later in the years, fashion brands came to realize a differentiation in customer groups in China. High salary residents do not share the same purchasing habit with those who are at the average level.
Unlike their parents, young people have a different mindset towards consumption. The fast-food culture has been spreading, not only in fashion industry, but also in other industries that were once durable, like automobiles and laptops. It was a perfect time to enter markets for fast fashion, and new business modes like increasingly mature online shopping as well as group purchase Hu, However, after a rapid expansion, fast fashion brands have slowed down. During recent years, customers have become increasingly aware that materialism and environment preservation in fast fashion industry have raised problems Liu, So many fast fashion brands that were once at the forefront of the industry chose to leave the Chinese market, such as New Look, Topshop and Forever With the Generation Z becoming the main purchase power, they have their own judgement and a better knowledge of the fashion industry.
They value personalization and sustainability. SPA is a vertically integrated system, with one company responsible for every step in the manufacturing and retail process, from product planning, design to retail sales. Though started in Los Angeles, Forever 21 has its footprints all over the globe.
It has been expanding rapidly and always pays a considerable amount of money to rent a large space. Some of its stores are as large as a department store and become a local iconic spot.
However, its revenue cannot cover the rent, and consequently, payment imbalance constantly occurs. Additionally, Forever 21 tried to bring customers closer through social media and its official website, which has constantly upgraded to become more user-friendly. Nonetheless, it spent money in areas other than brand delivery. Its competitors have adopted multiple ways to win customers, including cobranding, collaboration with designers or announcing regional product endorsers.
Forever 21 has two main retails channels, its large physical stores and online shops. It has been expanding too rapidly, starting from 7 countries to 47 countries in just six years. Before it announced bankruptcy, it was still opening up more physical stores. It missed the new industry practice that focuses on cutting down on the number of big and expensive physical stores and opening mini-shops or small pop-up stores to keep in contact with customers and help them experience the brands before making purchase decisions online Knowledge Wharton, Since the brand was one of the biggest tenants, the bust emptied more than 12, stores in the past two years, and it would be a challenge to refill these vacancies Sustainable Brands, Forever 21 has a problem with the originality and authenticity of its products.
It usually would take 3 to 6 months to turn an item from a design on the runways to the racks. However, Forever 21 has cut its production cycle down to weeks. Forever 21 does not have designers. Unlike ZARA , which has over designers participating in the same streamlined production process, Forever 21 has a bunch of journeymen travelling worldwide and attending fashion shows so that the brand could duplicate the latest work. Because of this, Forever 21 has already been sued more than 50 times for copyright infringement.
They would be forced to pay a considerable sum of money every time for settlement and finding ways to fix its declining public image before they were able to produce their own unique design or discover some talented independent designers who would love to work for the brand Roll, Forever 21 has been adopting the strategy to steal something legally protected and leave the unprotected ones behind Sauers, Its designs are popular in America, but Chinese young women are not comfortable with the mini-skirts or the hot tops with the least cloth.
It should have invested more in studying customers and predicting local market trends. It often indicates a user profile. Log out. US Markets Loading H M S In the news. Jessica Tyler. As a private company, Forever 21 doesn't release its sales numbers, but the New York Post reported in that the chain was struggling to pay its bills. The stores are both very trendy and offer similar-quality products for similar prices, but after visiting both, we found there was a clear winner between the two.
The store had fluorescent lights and huge windows, making it a bright and airy space to shop in. At the front of the store were some basic casual and business-casual staples like t-shirts, blazers, and sundresses. Almost everything was spotlessly clean and nicely displayed. That being said, the quality varied from one product to another. Some things felt like they were going to fall apart, while others seemed to be pretty high-quality.
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