Forever 21 Rebounds From Bankruptcy With Budget Bridal Line; A Peek at Their New Retail Strategy
In the wake of a turbulent retail landscape dominated by shrinking mall foot traffic and the e-commerce boom, a bankrupt mall retailer has defied the odds with a resurgence driven by an inexpensive and highly popular product range, per TheStreet. While the COVID-19 pandemic accelerated the decline of traditional shopping malls, the challenges facing large legacy stores were well underway before the virus hit. Factors such as rising rents, the rapid growth of online shopping, and market saturation had already left many malls resembling scenes from a dystopian film rather than bustling centers of consumerism reminiscent of the 1980s.
Resurrected mall retailer surges with affordable, viral product line
Amid this backdrop, the pandemic exacerbated the decline, leading to the closure of many mall-based stores, including prominent names like JC Penney and Macy's, and causing whispers of bankruptcy to echo through deserted corridors. Against this bleak outlook, a formerly bankrupt retailer has staged a remarkable comeback. Leveraging an affordable and irresistibly popular product line, this retailer has tapped into viral trends and consumer demand, breathing new life into the once-struggling business landscape of shopping malls. Forever 21, a prominent discount clothing retailer catering mainly to young women, has emerged from a challenging period marked by the decline of mall traffic and the COVID-19 pandemic. During the 2010s, Forever 21 gained popularity for its affordable fashion offerings, including crop tops, sundresses, and accessories. However, the shift away from traditional retail spaces, compounded by the pandemic-related closures in 2020, severely impacted the company's sales.
In September 2019, Forever 21 filed for Chapter 11 bankruptcy, leading to store closures and the cessation of operations in 40 countries. In early 2020, the company's remaining assets, valued at $81 million, were acquired by Simon Property Group, Brookfield Properties, and Authentic Brands, with a focus on revitalizing operations primarily in the central United States. Shortly after, store closures due to COVID-19 further challenged the brand. On April 24, the mall retailer unveiled plans to debut its inaugural bridal line, a strategic move aimed at expanding beyond its traditional focus on clothing tailored for teens and young adults frequenting nightlife scenes.
The new collection comprises 22 distinct styles designed for both brides and bridesmaids. The offerings include a variety of items such as dresses, hair accessories, swimsuits, lingerie, shapewear, pajamas, cowboy hats, jewelry, shoes, and handbags. Notably, this line features a price range from $8.99 to $47.99 and accommodates sizes from XS to XL, ensuring accessibility for a diverse range of consumers. It's reported that a significant portion of products target wedding-related festivities like bachelorette parties, wedding showers, receptions, and more informal ceremonies. Several mall retailers see potential in the bridal market. In 2023, Abercrombie & Fitch (ANF) announced plans to introduce its bridal collection, featuring approximately 100 dresses and accessories priced between $70 and $200.
Fashion retailer Express Inc. is exploring various options, including potential Chapter 11 bankruptcy, amidst intensified competition within the fast-fashion sector, per ModernRetail. According to retail analysts, the company's challenges have been evolving over a long period. Express, as reported by Bloomberg recently, has engaged in discussions with lenders regarding potential financing for a bankruptcy proceeding. The company has been contending with decreased demand over several quarters, influenced by consumers scaling back on discretionary spending and directing their purchases towards e-commerce giants like Amazon and Shein. In September, Express's CEO Tim Baxter resigned shortly after the company reported a 6% year-over-year decline in net sales for the second quarter of fiscal year 2023, amounting to $435.3 million. The new CEO, Stewart Glendinning emphasized to investors and analysts his commitment to charting a course toward restoring the company's full profitability potential in November.