The company Forever 21 announced late Sunday night that they will officially be filing for Chapter 11 bankruptcy protection.
What We Know:
- In their official statement, the company stated that “Forever 21, Inc. voluntarily filed for bankruptcy protection under chapter 11 of the U.S. Bankruptcy Code. Essentially this allows Forever 21 to continue to operate its stores as usual, while the Company takes positive steps to reorganize the business so we can return to profitability…”
- They also clarified the rumor that they would be going out of business by stating the contrary that “…filing for bankruptcy protection is a deliberate and decisive step to put us on a successful track for the future.”
- The company will be closing 178 U.S. stores and 172 other stores in different countries for a total of 350 store closures worldwide. The company currently has 800 worldwide stores with more than half of them located in the United States.
- Linda Chang, Forever 21’s executive vice president, stated that “we went from 7 countries to 47 countries within a less-than-six-year time frame and with that came a lot of complexity…The retail industry is obviously changing…there has been a softening of mall traffic and sales are shifting more to online.”
Hopefully Forever 21 can get back on their feet!