The story of Forever 21 began with a dream. Husband and wife Jin Sook and Do Won "Don" Chang emigrated from South Korea to America with ambitions to start a business.
Source: Business Insider
After working as a janitor and coffee server for three years, Don had a realization. "I noticed the people who drove the nicest cars were all in the garment business," Don told The Los Angeles Times in a 2010 interview.
In 1984, the couple opened a 900-square-foot clothing store in Los Angeles called Fashion 21, the predecessor to Forever 21.
The business took off. In its first year, the retailer pulled in $700,000 in sales. This initial success spurred further growth, and the couple began to open new stores every six months.
Source: Forever 21, Business Insider
The company eventually changed its name to Forever 21, and in 1989 it opened its first mall store in Panorama City, California.
In 1995 the company opened its first store outside California, in the Mall of the Americas in Miami, Florida. In 2001, the first international store opened in Canada.
Source: Forever 21
Forever 21 was soaring by 2010. There were 500 stores across the country, and the Changs had made it to No. 79 on the year’s Forbes 400 list of the richest Americans.
It wasn't long before Forever 21 made itself known as a destination for trendy clothes at affordable prices, a specialty that has been dubbed "fast fashion."
The company peaked in 2015, when it was bringing in around $4.4 billion in sales from over 600 stores and the founders had a combined net worth of $5.9 billion.
Source: Forbes, Business Insider
But things would soon start going downhill from there. Rising competition from other fast-fashion brands like H&M was causing real problems for the family-owned Forever 21.
In 2018, Forever 21 began downsizing and closing a number of European stores in Amsterdam, Dublin, and the UK, as well as some stores in North America.
Source: Fashion Network
In the first quarter of 2019, H&M Group — the parent company of H&M that also owns brands including & Other Stories and Cos — reported a 10% increase in net sales.
Source: Business Insider
Around that time, Business Insider's Bethany Biron visited a Forever 21 and an H&M store in New York's Westfield World Trade Center mall and saw that H&M drew more shoppers with its organized and well-lit store.
Source: Business Insider
Though Forever 21 did not — and still does not — publicly disclose its finances, store closures in major global markets suggest that the teen retailer has struggled to find its footing in an increasingly competitive market.
In June, Bloomberg reported that Forever 21 was exploring options for restructuring its business with private-equity firm Apollo Global Management.
In a statement emailed to Business Insider in June, a spokesperson for Forever 21 said: "Forever 21 is speaking with our lenders in the normal course of business and are in compliance with all of our agreements and continue to operate as usual."
Source: Bloomberg, Business Insider
By July, the Changs were no longer billionaires and their combined fortune had slumped to $1.6 billion, or $800 million each, Forbes reported.
Source: Forbes, Business Insider
The Wall Street Journal reported that the retailer could file for bankruptcy as soon as Sunday.
Source: CNBC, The Wall Street Journal
On Thursday, Forever 21 denied to Business Insider that it had imminent plans for bankruptcy, despite reports.
"The reports are inaccurate; Forever 21 is not planning to file for bankruptcy on Sunday. Our stores are open and it is our intention to continue to operate the vast majority of U.S. stores, as well as a smaller amount of international stores, providing customers with great service and the curated assortment of merchandise that they love and expect from Forever 21. Please visit our store locator to find the most up to date store list," the company said.
