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Forever 21

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Forever 21, Inc.
Company typePrivate
IndustryApparel
FoundedApril 16, 1984; 40 years ago (April 16, 1984)
FoundersDo Won Chang and Jin Sook Chang
Fatefiled for Chapter 11 bankruptcy
HeadquartersLos Angeles, California, U.S.
Number of locations
Decrease Around 623 (by 2019-20)[1]
Area served
United States
Key people
Daniel Kulle (CEO)
ProductsClothing, accessories
RevenueDecreaseUS$ 3.4 billion (2017)[2]
US$ 124 million (2011)[1]
Total assetsUS$ 1.4 billion (2011)[1]
Number of employees
32,800 (2018)[2]
ParentBrookfield Properties, Simon Property Group, Authentic Brands Group
Subsidiaries
  • Forever21 International
  • Forever 21
  • XXI Forever
  • Love 21
Websitewww.forever21.com

Forever 21, stylized as FOREVER 21, is an American-only fast fashion retailer headquartered in Los Angeles, California. Forever 21 began as the store called Fashion 21 with 900 square feet (84 m2) in Highland Park, Los Angeles, in 1984, and has grown into the clothing lines Forever 21, XXI Forever, Love 21 and Heritage with over 700 stores in the Americas, Asia, the Middle East and the UK.[2][3]

Forever 21 is known for its trendy offerings and low pricing.[4][5] The company sells accessories, beauty products, home goods and clothing for women, men and children. The company has been involved in various controversies, ranging from labor practice issues to copyright infringement accusations to religion.

History

Forever 21 in Hong Kong
Forever 21 at Denver Pavilions during a liquidation sale in November 2019
Forever 21 in CF Markville, which closed in spring 2018 and was replaced by a Uniqlo.

Originally known as Fashion 21,[6] the store was founded in Los Angeles on April 16, 1984 by husband and wife, Do Won Chang and Jin Sook Chang from South Korea.[7] The store is located at 5637 N. Figueroa Street in the Highland Park district of Los Angeles and is still in operation, bearing the chain's original name.[7] Designs similar to those seen in South Korea were sold to and targeted at the Los Angeles Korean American community. In its first year in operation, sales totalled $700,000 and, by 2013, there were more than 480 stores and a revenue of $3.7 billion.[8] Originally, Forever 21 only sold clothes for women but later expanded to sell menswear. Most Forever 21 stores now sell clothes for men and women, including plus size clothing for women.[citation needed] On its website, it also sells girls' clothing and home/lifestyle products.[9]

Forever 21's sales peaked in 2015, with $4.4 billion in global sales that year.[10] and in 2017, Forever 21 generated a revenue of $3.4 billion.[11]

Bankruptcy

On September 29, 2019, Forever 21 filed for Chapter 11 bankruptcy.[12] The chain announced that it will file a motion to close up to 178 of its 506 U.S. stores and most of its stores in Asia and Europe.[13] Linda Chang, executive vice president for the company, reported that filing for Chapter 11 is "an important and necessary step to secure the future of our Company, which will enable us to reorganize our business and reposition Forever 21."[14]

The company closed all of its Japanese stores at the end of October 2019,[15] while all of its Canadian stores were closed at the end of November 2019.[16]

On February 2, 2020 it was announced that Forever 21 had reached a deal to sell all of its assets for $81 million to a consortium of mall operators Simon Property Group and Brookfield Properties, and brand management firm Authentic Brands Group, subject to approval by a bankruptcy court judge.[17]

Downfall

Preceding the alleged cases, Forever 21 sales only declined even further, after CEO Do Won Chang admitted to the company's misuse of cheap overseas labor in the latest interview with People Magazine in June 2019.[18] More controversy arose when many employees began speaking out about the toxic work environment and unfair pay. A major spike in employee dissatisfaction lead to a movement promoting the unethical fast fashion industry in North America. This caused a 32% drop in sales in 2019 alone,[19] forcing the company to permanently become a discount store; where the main focus is to break even with the excess clothing they store. Major influencers have dropped their sponsorships following the exposure of the company's unethical practices; further propelling Forever 21 as an unreputable clothing brand.

In September 2019, the company filed for bankruptcy protection. The case was filed on September 29, 2019 in Delaware as case number 19-12122.[20] The company announced that it was ceasing operations in 40 countries and closing most of its international and 178 of its US stores, while aiming to allow mall operators and landlords to have a stake in the company.[21][22] The company plans to close most of its stores in Asia and Europe, and focus on the profitable core part of its operations in the US and Latin America.[23][24][25][26][27] After filing for bankruptcy in September, Forever 21 has reached a deal to sell off its assets for $81 million[28] to Authentic Brands Group and Simon and Brookfield mall landlords. [29]

Controversies

Employee relations and safety

Forever 21
Forever 21 in Montreal
  • In September 2001, the Asian Pacific American Legal Center and the Garment Worker Center, workers’ advocacy groups, filed a lawsuit against Forever 21, charging them of violating labor practice laws.[30] They claimed that 19 contracted employees received less than the minimum wage, that the hours on time cards were reduced, that workers who complained to the state were fired, and that the employees faced sweatshop-like working conditions.[30] Forever 21 denied the accusations, asserting its commitment to fair labor practices and that "none of the workers named in the suit were directly employed by the company".[30] A three-year boycott of Forever 21 was held throughout the United States by the garment workers and this movement was captured in the Emmy Award-winning documentary, Made in L.A.[31][32] Although the charge was dismissed by U.S. District Court Judge Manuel Real, Forever 21 responded with a defamation suit in 2002.[33] Attorney Robin D. Dal Soglio asserted that both Forever 21's reputation and its sales were impacted by the allegations and protests.[33] On the other hand, Kimi Lee, the director of one of the advocacy groups that represented the workers, maintained that the lawsuits were justified due to complaints from 20 workers.[33] Both cases ended in a settlement in December 2004.[34]
  • Five Forever 21 employees filed a class action lawsuit in January 2012, declaring they were not compensated for the time they worked during their lunch breaks and the time spent on bag checks.[35]
  • After the Labor Department found that some of Forever 21's suppliers had violated various federal laws on wages and record keeping, a subpoena was ordered in August 2012.[36] U.S. District Court Judge Margaret Morrow ordered Forever 21’s compliance after the retailer failed to provide the documents.[37] The retailer claimed that it tried to meet with the Labor Department and that it had provided the requested information.[36]
  • In July 2014, the U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) recommended fines in excess of $100,000 for three different retail locations in Northern New Jersey and Manhattan for "serious safety hazards" for which they had been cited since 2010.[38]
  • According to Forbes, 50 copyright violation lawsuits have been placed against Forever 21.[39][40] Diane von Fürstenberg sued the retailer insisting it copied four of her dresses.[41] Gwen Stefani, Anna Sui and Trovata are among the designers who have also taken action against the retailer.[40] During the Trovata case in May 2009, the jury agreed with Trovata. The two sides reached a settlement.[42]
  • Critics such as Susan Scafidi, a professor of copyright law at Fordham University, question Forever 21’s design process and argue that it is replicating the designs of others.[32] Forever 21’s Vice President of Merchandise, Lisa Boisset, was quoted in 2007 as saying that Forever 21 works with merchant designers and not with designers, but would not make those merchants available for comment.[43] CEO Chang said that some of their merchants had disappointed him.[32] Forever 21 has never been found guilty and the majority of cases have been resolved through settlements.[40]
  • On 8 January 2015, Canadian media reported on a local, family-owned business in Richmond, British Columbia, Granted Clothing, whose designer noticed that their sweater designs had been stolen and mass-produced for sale on Forever 21's website.[44] In April 2015, both parties resolved the matter on "amicable terms", settling out of court.[45]
  • On 28 January 2015, the software developers Adobe, Autodesk and Corel filed a joint lawsuit against Forever 21 for allegedly using unlicensed copies of Photoshop, AutoCAD and PaintShop Pro, respectively.[46]

Other controversies

  • Forever 21's clothing has been criticized in the media due to the slogans printed on some of its shirts. The Daily Mail, The Huffington Post and others insisted that the company was "…pushing a Christian agenda" because it sold tops with phrases such as "Holy", "Love, peace, faith, hope, Jesus", and "Thank God".[47] Similarly, Forever 21 has received attention in the media for printing the Bible verse "John 3:16" on the bottom of its trademark yellow bags.[48] The corporation maintains that it is not influenced by the religion of its founders, who are born-again Christians.[32] Moreover, ABC News, numerous users on Reddit and others condemned Forever 21 for its "Allergic to Algebra" shirt in 2011.[49] They declared that the shirt had an anti-education and sexist theme, but Ellie Krupnick, a writer for The Huffington Post, questioned this.[49][50] Krupnick's view was that the top was making a remark about mathematics, rather than a sexist remark, and announced that she would wear it.[50]
  • In April 2010, Rachel Kane, a writer and Forever 21 customer created a blog with the domain name WTForever21.com.[51] Kane posted pictures of some Forever 21 items and voiced her opinions about the clothing.[51] The blog's popularity rose after being featured on the Jezebel blog and, in June 2011, the retailer asked the blogger to take the site down or she might face a lawsuit.[51]
  • The Center for Environmental Health found that Forever 21 and 25 other retailers and suppliers sold jewelry that included the toxic metal cadmium.[52] A payment of $1.03 million and a 0.03% limit on cadmium in jewelry were part of the settlement that took place in 2011.[52]
  • Lawyer Carolyn Kellman filed a class action lawsuit against Forever 21 in September 2012 after she received one penny less when she returned several items.[53] Customers who received a penny less or were charged one more joined the case.[53] According to The Huffington Post, these pennies added up as "The threshold for civil actions in her court district is $15,000 -- meaning, she had to find enough people to join the case so that she could cite 1.5 million pennies in damages (750,000 customers since 2007.)"[53]
  • Forever 21 has been accused of fat shaming due to their inclusion of Atkins' brand weight-loss bars with orders containing plus-sized clothing. Forever 21 apologized, stating that the inclusion of the bars was an "oversight."[54]
  • In September 2019, American singer Ariana Grande accused and sued Forever 21 for $10 million for copying her style and likeness by dressing up their models the same way in their photo shoot from her music video of "7 Rings".[55]

Store count

Outside the United States, most of stores are franchised or, in some markets, operated in joint ventures with a local partners. The average store size is 38,000 square feet (3,500 m2).[3]

Africa:

The Americas:

Asia:

Europe:

Oceania:

Former locations

References

  1. ^ a b c "#162 Forever 21", Forbes, n.d. Retrieved 1 May 2014.
  2. ^ a b c "Forever 21." Forbes. Forbes Magazine, n.d. Web. 27 Apr. 2014. <https://www.forbes.com/companies/forever-21/>
  3. ^ a b Forever 21. History & Facts ,n.d. Retrieved 27 April 2014.
  4. ^ Chang, Andrea, "Forever 21 Agrees to Grab Gottschalks Locations", Los Angeles Times, 22 May 2009. Retrieved 14 May 2014.
  5. ^ Earnest, Leslie, "Forever 21 to Acquire Retailer Gadzooks", Los Angeles Times, 18 February 2005. Retrieved 14 May 2014.
  6. ^ "Iconic businesses from the year you were born: 1984" Archived 2017-07-28 at the Wayback Machine, MSN.com. Retrieved 28 July 2017.
  7. ^ a b "6 Things You Didn’t Know About Forever 21", WhippedSTYLE, 25 March 2011. Retrieved 28 April 2014.
  8. ^ Do Won Chang. "Interview with CEO and Founder of Forever 21", CNN, 28 April 2014.
  9. ^ "Forever 21". Forbes.
  10. ^ Wang, Irene Kim, Kaitlyn. "At its peak, Forever 21 made $4.4 billion in revenue. Here's what led to the brand's downfall and bankruptcy". Business Insider. Retrieved 2019-12-02.{{cite web}}: CS1 maint: multiple names: authors list (link)
  11. ^ "Forever 21 on the Forbes America's Largest Private Companies List". Forbes. Retrieved 2018-11-26.
  12. ^ Business, Nathaniel Meyersohn and Chris Isidore, CNN. "Forever 21 files for bankruptcy, intends to close up to 178 of its US stores". CNN. Retrieved 2019-09-30. {{cite web}}: |last= has generic name (help)CS1 maint: multiple names: authors list (link)
  13. ^ Debter, Lauren. "Forever 21 Files For Bankruptcy, Will Shutter Over 100 Stores". Forbes. Retrieved 2019-09-30.
  14. ^ Thomas, Lauren Hirsch,Lauren (2019-09-30). "Forever 21 files for bankruptcy, plans to close most of its stores in Asia and Europe". CNBC. Retrieved 2019-09-30.{{cite web}}: CS1 maint: multiple names: authors list (link)
  15. ^ "Forever 21 to pull out of Japan by late October". The Japan Times. News2u Holdings, Inc. September 25, 2019. Retrieved December 7, 2019.
  16. ^ "Forever 21 plans to start its huge liquidation sale this week | Venture". dailyhive.com. Retrieved 2019-10-08.
  17. ^ Duffy, Clare (2 February 2020). "Forever 21 Bankruptcy: Retailer enters deal to sell for $81 million". CNN. Retrieved 3 February 2020.{{cite news}}: CS1 maint: url-status (link)
  18. ^ "One Family Built Forever 21 and Fueled Its Collapse". Retrieved February 5, 2019.
  19. ^ "Forever 21 Considers Bankruptcy As Mall Sales Decline". Retrieved February 5, 2019.
  20. ^ "Bankruptcy of Forever 21, Inc". BankruptcyObserver.com. Retrieved October 9, 2019.
  21. ^ https://www.bloomberg.com/amp/news/articles/2019-09-27/forever-21-at-an-impasse-on-landlord-deal-ahead-of-bankruptcy
  22. ^ "Fashion retailer Forever 21 files for bankruptcy". Reuters. 2019-09-30. Retrieved 2019-09-30.
  23. ^ Maheshwari, Sapna (September 29, 2019). "Forever 21 Bankruptcy Signals a Shift in Consumer Tastes" – via NYTimes.com.
  24. ^ "Forever 21, Inc. To Implement Global Restructuring to Focus on Profitable Footprint". www.businesswire.com. September 30, 2019.
  25. ^ "Retailer Forever 21 files for bankruptcy, but will continue in Latin America". MercoPress.
  26. ^ "Forever 21 latest retailer to file for bankruptcy". Reuters. 2019-09-30. Retrieved 2019-09-30.
  27. ^ "One Family Built Forever 21, and Fueled Its Collapse". New York Times. 23 October 2019.
  28. ^ Business, Clare Duffy, CNN. "Forever 21 Bankruptcy: Retailer enters deal to sell for $81 million". CNN. Retrieved 2020-02-19. {{cite web}}: |last= has generic name (help)CS1 maint: multiple names: authors list (link)
  29. ^ Nguyen, Terry (2019-08-29). "Bidding has begun on bankrupt Forever 21". Vox. Retrieved 2020-02-17.
  30. ^ a b c Cleeland, Nancy. "Lawsuit Against Forever 21 Alleges Unfair Labor Practices", Los Angeles Times, 7 September 2001. Retrieved 28 April 2014.
  31. ^ Berfield, Susan. "Forever 21's Fast (and Loose) Fashion Empire", Bloomberg Business Week, 20 January 2011. Retrieved 28 April 2014.
  32. ^ a b c d Wiseman, Eva, "The Gospel According to Forever 21", The Observer, 17 July 2011.
  33. ^ a b c Cleeland, Nancy. "Forever 21 Files Defamation Suit Against Groups", Los Angeles Times, 7 March 2002. Retrieved 28 April 2014.
  34. ^ Earnest, Leslie. "Forever 21 Settles Dispute With Garment Workers", Los Angeles Times, 15 December 2004. Retrieved 28 April 2014.
  35. ^ Hines, Alice. "Forever 21 Class Action Lawsuit Filed By Employees", The Huffington Post, 18 January 2012. Retrieved 28 April 2014.
  36. ^ a b Li, Shan, "Forever 21 Investigated for Vendors' Alleged 'sweatshop' Conditions", Los Angeles Times, 29 October 2012. Retrieved 28 April 2014.
  37. ^ Hsu, Tiffany. "Judge Orders Forever 21 to Hand over Subpoenaed Documents", Los Angeles Times, 14 March 2013. Retrieved 28 April 2014.
  38. ^ Kleimann, James (21 July 2014). "Forever 21 still exposing North Jersey employees to hazardous conditions, feds allege". NJ.co. Retrieved 21 July 2014.
  39. ^ "Jin Sook & Do Won Chang", Forbes, 28 April 2014.
  40. ^ a b c Sauers, Jenna, "How Forever 21 Keeps Getting Away With Designer Knockoffs", Jezebel, 20 July 2011.
  41. ^ "Diane Von Furstenberg v. Forever 21 - Fashion Designer Lawsuits", Elle, 28 April 2014.
  42. ^ Sauers, Jenna, "Lagerfeld Slams Big Women; Louboutin Slams Barbie's Ankles", Jezebel, 12 October 2009.
  43. ^ La Ferla, Ruth, "Faster Fashion, Cheaper Chic", The New York Times, 9 May 2007.
  44. ^ Singh, Simran. "Richmond company claims Forever 21 ripped off its sweater designs". Van City Buzz. Archived from the original on 18 August 2017. Retrieved 9 January 2015.
    - Judd, Amy. "Richmond clothing company claims Forever 21 ripped off their designs". Global News. Retrieved 9 January 2015.
    - Lindsay, Bethany. "Forever 21 accused of copying Richmond company's sweater designs". Vancouver Sun. Retrieved 9 January 2015.
    - Harowitz, Sara. "Granted Clothing, B.C. Store, Says Forever 21 Stole Its Designs". Huffington Post Canada. Retrieved 9 January 2015.
  45. ^ Harowitz, Sara, "Granted Clothing, B.C. Store, Says Forever 21 Stole Its Designs", Huffington Post, 30 April 2015.
  46. ^ Mathew, Jerin. "Adobe sues fashion retailer Forever 21 for allegedly pirating Photoshop". International Business Times UK. Retrieved 31 January 2015.
    - "Adobe Systems, Inc., Autodesk, Inc., and Corel Corporation vs. Forever 21, Inc" (PDF). Retrieved 31 January 2015.
  47. ^ Dumas, Daisy, "Fashion Chain Forever 21 Accused of Pushing Religious Agenda with Christian-themed T-shirts", Mail Online, 11 August 2011. Retrieved April 2014. [unreliable source?]
  48. ^ Kolben, Deborah, "Evangelism in Fashion", The New York Sun, 18 August 2006. Retrieved 29 April 2014.
  49. ^ a b Ng, Christina, "Forever 21′s ‘Allergic to Algebra’ Shirt Draws Criticism", ABC News, 12 September 2011. Retrieved 25 April 2014.
  50. ^ a b Krupnick, Ellie, "'Allergic To Algebra' Tee From Forever 21 Under Fire", The Huffington Post, 12 September 2011. Retrieved 28 April 2014.
  51. ^ a b c Little, Lyneka, "Forever 21 Threatens Blogger With Lawsuit for WTForever21 Site", ABC News, 8 June 2011.
  52. ^ a b Chang, Andrea, "Retailers Settle Suit over Cadmium in Jewelry", Los Angeles Times, 7 September 2011.
  53. ^ a b c Adams, Rebecca, "Carolyn Kellman Sues Forever 21 Over Alleged 'Penny-Pinching Scheme'", The Huffington Post, 5 September 2012.
  54. ^ "Forever 21 accused of 'fat shaming' over diet bars". 2019-07-24. Retrieved 2019-07-24.
  55. ^ Callahan, Chrissy. "Forever 21 responds to Ariana Grande's lawsuit over 'look-alike' model". Today. Retrieved 21 September 2019.
  56. ^ Quintino Gomes Freire, "Forever 21 chega ao Shopping Tijuca neste sábado", Diário do Rio de Janeiro, 9 December 2016. (in Portuguese)
  57. ^ "Forever 21 opens 21st store in India". Apparel Resources. 11 December 2017. Retrieved 6 August 2018.
  58. ^ "Sayonara, Forever 21! Mr. Sato hits up the chain's "everything must go sale" with only 50 yen". November 6, 2019.

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