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HomeeCommerce NewsWhy Forever21 filed for bankruptcy

Why Forever21 filed for bankruptcy

forever21 closure

The ecosystem of Retail is probably changing faster than we can think!  Forever21 bankruptcy is the latest proof of the same.  Retail is experiencing irreversible changes and would quickly need to mold itself as per the needs and behavior of the customers.

Everything seems to be going well for forever21 in year 2016 with a revenue of 4 Billion ++, 32k+ employees, and more than 600 locations.  Their website also contributed 16% of the revenue.  In September 2019, the company filed for bankruptcy protection and closed operations in 40 countries.  It closed most of its international stores and 178 US outlets.  It will continue to operate some stores and their website.  So what went wrong?

Bankruptcy

It will be easy to say that Amazon happens to them.  For sure, Amazon.com is impacting retail in a bigger way than ever before, but that may not be the only reason. With decreasing footfalls in malls, customers visiting malls, but purchasing online, changing trends, and pricing are some of the factors that took forever21 down.

The brick and mortar stores need to quickly transform themselves and adopt online in a much broader way.  Technologies like personalization, AI, machine learning, Augmented Reality are lifesavers if adopted properly.  We see so many retailers struggling to get the basic ecommerce right and restricted themselves to the shopping cart-related work only.  Technology adaptation inside the retail stores also hasn’t shifted fundamentally.

eCommerce Next team has reached out to forever21 for their comments

Sonali Minocha
Author: Sonali Minocha

Passionate about Innovation and Technology. I love to contribute to high impact projects/ products. I have co-created/contributed to technology solutions touching 100 million ++ humans. I am also fond of e-commerce & PIM solutions. As editor of eCommerceNext, I am bringing news, events, opinions, experts, reviews from the world of e-commerce and PIM Besides technology and innovation, I am usually involved in setting up and running complex operations and human capital systems. I have been grateful to be acknowledged by getting “Great Places to Work – Top 100”, “Great Places to Work – Top 50”, “Great Place to Work – Top 5” awards for my company. I am a people and relationship person and bring in a balance of empathy and realistic solutions. I thrive on building processes and building control systems. I led the team that achieved CMMI Level 3. I have managed large teams and in-turn managed projects worth 15-20 Million (Annually) Want me to cover an interesting story around eCommerce or PIM? Reach me on [email protected]

Author

Passionate about Innovation and Technology. I love to contribute to high impact projects/ products. I have co-created/contributed to technology solutions touching 100 million ++ humans. I am also fond of e-commerce & PIM solutions. As editor of eCommerceNext, I am bringing news, events, opinions, experts, reviews from the world of e-commerce and PIMBesides technology and innovation, I am usually involved in setting up and running complex operations and human capital systems. I have been grateful to be acknowledged by getting “Great Places to Work – Top 100”, “Great Places to Work – Top 50”, “Great Place to Work – Top 5” awards for my company.I am a people and relationship person and bring in a balance of empathy and realistic solutions. I thrive on building processes and building control systems. I led the team that achieved CMMI Level 3. I have managed large teams and in-turn managed projects worth 15-20 Million (Annually)Want me to cover an interesting story around eCommerce or PIM? Reach me on [email protected]