Fast fashion retailer Forever 21 has officially filed for bankruptcy.
The retailer is looking for a new buyer for the company, and should they find one, operations will remain open. However, currently, the company is planning liquidation sales to eventually close its doors. Until a final decision is made, both in-store and online sales will be operational.
“Following the conclusion of our strategic review and after careful deliberation, we made the decision to file for chapter 11 to implement a court-supervised marketing process to solicit a going concern transaction, and, in the absence of such an arrangement, an orderly wind down of operations,” Brad Sell, Chief Financial Officer, said in a news release.
“While we have evaluated all options to best position the Company for the future, we have been unable to find a sustainable path forward, given competition from foreign fast fashion companies, which have been able to take advantage of the de minimis exemption to undercut our brand on pricing and margin, as well as rising costs, economic challenges impacting our core customers, and evolving consumer trends.”
Store closures signaled the end of an era
This marks the second time the company has had financial issues, as it first filed for bankruptcy in 2019. At the time, the retailer closed 200 stores.
Now, six years later, the retailer is in a similar position once again. In late February 2025, Forever 21 announced it would be closing 200 stores and laying off 350 employees – an early sign of the ultimate bankruptcy filing.
The retailer’s international stores – including online shopping – will remain open throughout the bankruptcy process, as they are owned by different licensees.