4. Forever 21
Forever 21 just filed for bankruptcy—again. For the second time in six years, the fast-fashion retailer is back in court, out of cash, and out of time. What was once a mall mainstay and teen fashion staple has become a relic in freefall, buried by debt, disrupted by Shein, and forgotten by Gen Z.
Bankruptcy, Round Two
The numbers are brutal. $1.58 billion in debt. $400 million in losses over the past three years. $150 million lost in 2024 alone, with another $180 million projected for 2025. On March 17, the company filed Chapter 11 for the second time since 2019. The problem isn’t just financial—it’s foundational. Forever 21 never evolved. And the world moved on.
Store Shutdowns and Corporate Collapse
As part of its restructuring plan, Forever 21 is closing all 350 U.S. stores and launching liquidation sales across the country. Thousands of jobs? Gone. The brand’s L.A. headquarters? Shutting down. More than 350 corporate employees will be laid off starting April 21. This isn’t a strategic retreat—it’s an industry exit.
Outgunned Online: Shein, Temu & the $800 Loophole
Forever 21 wasn’t just beat—it was outmaneuvered. Fast-fashion disruptors like Shein and Temu mastered the online game and exploited the “de minimis” loophole, which allows shipments under $800 to bypass import duties. That’s how 1.4 billion packages entered the U.S. last year—cheap, fast, and duty-free. Forever 21 couldn’t compete on price or speed, and by the time it noticed, it was already too late.
Expansion Regrets and the Post-Mall Collapse
After its first bankruptcy in 2019, Forever 21 tried to bounce back with help from Authentic Brands Group and a few new investors. The problem? They kept trying to fix a digital problem with mall-era thinking. The brand doubled down on physical stores when customers were doubling down on TikTok. Their strategy? More square footage. The market’s strategy? More screen time.
The Bottom Line
Forever 21 didn’t just lose money—it lost relevance. The brand missed the cultural shift, underestimated online competition, and burned through its second chance. Now it’s liquidating stores, laying off staff, and clinging to whatever’s left of a once-dominant name.
If there’s any future here, it’ll be digital, minimal, and probably unrecognizable. But at this point, one thing is clear: Forever 21’s fast-fashion fantasy has officially expired.
All hope isn’t lost yet, as there are ways of returning even from multiple bankruptcies. Find the solutions to these major issues below.