Iconic Mall Retailer Set to Declare Bankruptcy, Liquidate All 350 Stores

The operator of Forever 21 is preparing for a potential bankruptcy filing, which could lead to widespread store closures. Efforts to find a buyer have so far fallen short, signaling trouble for the once-dominant fast-fashion retailer.

Key Facts:

Forever 21 may file for bankruptcy in the coming days, potentially shutting down its stores.
Attempts to sell the retailer and avoid liquidation have been unsuccessful.
The brand peaked with 800 stores worldwide but now has about 350 in the U.S.
Authentic Brands owns Forever 21’s trademark and plans to continue licensing it.
The company was acquired in January by Catalyst Brands, which also owns JCPenney.

The Rest of The Story:

Forever 21, once a leader in fast fashion, has struggled in recent years.

The brand previously filed for bankruptcy in 2019, only to be rescued by a partnership between Authentic Brands, Simon Property Group, and Brookfield Properties.

Now, with shrinking sales and changing consumer habits, the retailer faces yet another financial crisis.

Its operating company was acquired by Catalyst Brands earlier this year, but that hasn’t been enough to turn things around.

As negotiations with a potential buyer continue, the likelihood of store closures and liquidation grows.

Meanwhile, Authentic Brands, which owns the Forever 21 trademark, says it will continue licensing the name, possibly shifting focus toward e-commerce.

#RetailApocalypse As predicted here, #Forever21 likely to be a complete wipeout, #liquidation #AuthenticBrands https://t.co/tuGVPkMqWW

— David D. Tawil (@DavidDTawil) March 14, 2025

Commentary:

Forever 21’s struggles highlight two major economic forces at play—high inflation and the decline of traditional shopping malls.

Inflation has squeezed consumer wallets, making discretionary spending on fast fashion less appealing.

The Biden administration’s economic policies have fueled rising prices, leaving families with less disposable income for non-essential purchases.

This has hit retailers like Forever 21 especially hard.

The collapse of mall culture has also been a long time coming.

Shopping centers were once the heart of retail, but the shift to online shopping has made them relics of the past.

Consumers today prefer the convenience of e-commerce, where they can shop from their phones rather than making a trip to a mall.

Many brick-and-mortar stores have struggled to adapt, and Forever 21 is no exception.

This isn’t just about one retailer’s failure—it’s a warning sign for the broader retail industry.

Other major brands will likely face the same fate as online shopping continues to dominate.

Even discount retailers and department stores aren’t safe, as consumers increasingly look for deals on digital platforms instead of at physical locations.

The reality is that Forever 21’s core business model—low-cost, trendy clothing sold in large mall stores—doesn’t work in today’s market.

Without a significant shift to digital and a leaner store footprint, the brand’s future remains uncertain.

Unfortunately, this may just be the beginning of a larger wave of retail closures.

The Bottom Line:

Forever 21’s financial troubles are another sign that inflation and changing consumer habits are reshaping retail.

With malls struggling and e-commerce taking over, traditional retailers are facing an uphill battle.

Expect more store closures and bankruptcies as the industry continues to shift online.