What Forever 21’s Downfall Means for the Fashion World
At its peak in 2015, Forever 21 made $4.4 billion in revenue. Today, it’s facing bankruptcy. But what does the franchise’s quickly falling fortune mean for the rest of the fashion industry?
Founded in 1984 in Los Angeles by South Korean immigrants Jin Sook and Do Won Chang with just $11,000 in savings, Forever 21 was an instant hit. Just a few years later, stores were opening all over the world, cultivating a devoted following by selling the latest trends at rock-bottom prices. Want a tank top for $1.99? A knockoff of a high-end design for less than $20? Forever 21 was the place to go.
The Changs became billionaires, and by 2017, they were determined to expand more aggressively than ever before. They bet their business on their own optimism that their brick-and-mortar stores would continue to draw in customers despite declining in-person sales throughout the industry and the slow death of the American shopping mall. It didn’t pay off. The company is now $500 million in debt, closing many of its stores, and prompting speculation that the entire fast fashion sphere is soon to follow.
At the core of Forever 21’s business model is a lightning-fast supply chain dependent on the both rapid-fire development and approval of new (and often stolen) designs and the cheapest possible labor to produce garments of highly disposable quality. And with awareness about pollution, climate change, and human rights violations rising in the public consciousness, it’s tempting to argue that we’re all finally waking up to the true toll of fast fashion.
Of course, that toll is almost incalculable. Forever 21 is just one of many major fashion brands that use sweatshops to manufacture their garments, with workers facing long hours and unsafe conditions for very little pay. In one of the worst consequences to date, 1,100 factory workers were killed when the eight-story Rana Plaza garment complex collapsed in Bangladesh in 2013.
Then there’s the environmental impact. The United Nations Conference on Trade and Development considers fashion to be the second most polluting industry in the world, after oil. That’s because the production of clothing not only uses a whole lot of water, it also produces a ton of toxic contaminants. Consumers are encouraged to buy cheap garments, wear them just a few times before they fall apart or become outré, and then toss them in the trash.
One promising factor in Forever 21’s decline is the rise of resale and rental fashion. Companies like Poshmark and ThredUP offer consumers an easy way to sell and shop for secondhand goods, while Rent the Runway, Le Tote, and Armoire are among the services allowing members to swap out their entire wardrobes every month for a small fee.
But fast fashion likely won’t die with Forever 21, if the brand doesn’t manage to bounce back from its bankruptcy proceedings (which it may still). ASOS, Fashion Nova, and other retailers prove that the demand for it is still plenty high, especially when their business models are built with fast-fulfillment e-commerce in mind. The retail industry is shifting as consumers seek an experience that’s more centered upon shopping from the comfort of home, with physical locations emphasizing immersion in the brands’ unique identities rather than the task of sorting through endless racks.
Does Forever 21’s downfall portend the end of fast fashion? If only. Unfortunately, contemporary culture is still fixated on instant gratification, and there are plenty of people who can’t or won’t spend more than the absolute minimum to get their trendy fashion fix. But one can hope that as Generation Z grows ever more vocal about climate change and injustice, they’ll start pushing the rest of us toward better practices, and corporations will have no choice but to follow.