Forever 21, one of the most well-known fast-fashion retailers, has been in business for almost 40 years, through plenty of ups and downs. First known as Fashion 21, the company was founded by husband-and-wife duo Jin Sook and Do Won Chang after they emigrated from South Korea to Los Angeles in 1981.
They then opened their first store in 1984 from the ground up, with only $11,000 in savings. According to Forbes, the couple hit $700,000 in revenue the first year, prompting them to open a new store every six months. Revenue peaked at an estimated $4.1 billion in 2015, when Forever 21 employed more than 43,000 people worldwide in hundreds of stores.
Early Growth
Forever 21 has been known for its young consumer base, luring them in with low-price merchandise, including tops for $5 and shoes for under $30. As the retailer began to expand, all stores were located in California, until 1995, when one opened at Miami’s Mall of Americas. Flagship stores soon opened in Texas, Miami, LA, Chicago and Canada. It then grew from seven international stores in 2005 to 262 a decade later. In 2014, it operated about 600 locations, growing to 800 stores worldwide, with 549 in the U.S. More than 70 of its locations exceeded 35,000 square feet.
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Throughout this time, it was a privately-owned, family business. In 2008, the Changs’ daughters, Linda and Esther worked at the company together, with Linda running the marketing department, and Esther leading graphic design, visuals and more. Mom Jin Sook, meanwhile, was Forever 21’s chief merchandising officer, and dad Do Won was CEO.
Forever 21 Going Bankrupt
In September 2019, Forever 21 filed for Chapter 11 bankruptcy in the United States Bankruptcy Court for the District of Delaware. At the time, shifting consumer preferences to e-commerce and shopping more ethically and sustainably minded, paired with mounting debt and declining foot-traffic, Forever 21 faced many challenges.
According to the filings, it planned to close up to 178 stores in the U.S. and most of its locations in Asia and Europe. It said it would continue operations in Mexico and Latin America. Four months after filing for bankruptcy, Forever 21 reached a deal to sell its business. In its bankruptcy filing estimated assets were on par with liabilities in the range of $1 billion to $10 billion.
Who Owns Forever 21 Now?
Court documents filed in February 2020 showed that the fast-fashion retailer entered into an agreement to sell off its assets for $81.1 million to a consortium of buyers, including mall owners Simon Property Group and Brookfield Property Partners as well as brand management firm Authentic Brands Group. As part of the acquisition, ABG and Simon each own 37.5% of the fast-fashion retailer, while Brookfield will take control of the remaining 25% of Forever 21’s intellectual property and operating businesses.
“Forever 21 is a powerful retail brand with incredible consumer reach and a wealth of untapped potential,” ABG founder, chairman and CEO Jamie Salter said in a statement at the time. “We’re looking forward to working with the Forever 21 team and our global partners. Together, we’ll revitalize the brand’s core business and connect with audiences around the world through new product offerings and experiences.”
ABG and mall landlords Simon Property Group and Brookfield Asset Management first teamed up to save Aéropostale out of bankruptcy in 2016 before taking on Forever 21 and JCPenney. (Authentic and Simon also formed the SPARC Group joint venture in 2021, which plucked Lucky Brand and Brooks Brothers out of bankruptcy. SPARC’s portfolio also includes Reebok, Eddie Bauer and Nautica.)
In addition, Shaquille O’Neal is the second-largest individual shareholder of Authentic Brands Group, making him one of the owners of Forever 21, Barneys New York, JCPenney, Reebok, Vince and Hunter Boots. ABG is led by CEO Jamie Salter.
A New Future
In late 2021, JCPenney announced that it added Forever 21 to its offering. JCPenney, which operates 650 stores across the U.S., now sells an assortment of tops, bottoms, and dresses across the Forever 21 catalogue in JCPenney 100 stores and on its website. (Both JCPenney and Forever 21 are owned by Authentic Brands Group via its venture group SPARC.) And in 2022, the same year it tapped Winnie Park as CEO, the owners looked to expand Forever 21 further with 14 new stores launching across the U.S. through spring 2023.
The first location to open under the plan was a store at the Gran Plaza Outlets in Calexico, Calif., which opened its doors in August last year. Other new stores set to open included locations in Florida, Georgia, Pennsylvania, Virginia and more.
Forever Footwear
While Forever 21 has offered a range of affordable shoe styles through the years, the retailer has had many collaborations and endeavors to bolster its footwear business. There’s been some hiccups along the way, too.
Popular collaborations have come from Brazilian brand Melissa’s diffusion line Mel, Airwalk, K-Swiss — and even Justin Bieber.
In 2014, for instance, it launched a premium leather collection. The line retailed from $49 to $79, as a step up from its then current selection, which was priced below $40.
In 2017, Forever 21 found itself defending against intellectual property claims from Puma. The German athletic giant sued the chain alleging copyright, design patent and trade dress infringement related to several of Fenty x Pumas well-known shoe styles, including the bow slide, the faux-fur slide and the Creeper. In 2018, they reached a settlement in their legal battle. (Forever 21 has been sued for trademark infringement a multitude times, which also included lawsuits from Adidas and Gucci.)
Most recently, Forever 21 partnered with Nine West on a limited-edition shoe collection for spring ’23. The collaboration featured a range of styles, including platform heels, stilettos and wedges.
“Forever 21 spans multiple generations of shoppers, from Gen X to Gen Z, and we’re committed to creating inclusive and accessible fashion for our customers of all ages,” CEO Winnie Park told FN on why Nine West was an ideal partner. “Iconic brands like Nine West present an opportunity for Forever 21 to speak to a broad demographic and offer on-trend and affordable fashion to shoppers of all ages.”
