Forever 21one of the most iconic brands in fast fashion, has decided to close its stores in PeruThis decision is part of a regional divestment strategy that also affects Colombia and Chile, countries where the chain has already begun to withdraw. The company has not been able to sustain its initial success in the face of tough competition and recent economic adversities.
The closure of stores in Peru has already begun and is accompanied by a series of significant discounts on its clothing, marking the beginning of the end of its presence in the country. Below, find out which stores have closed and the reasons behind their financial crisis.
Forever 21: Why is the brand leaving the country?
Forever 21 has faced multiple challenges since its arrival in Peru in 2014. The brand’s entry into the Peruvian market was received with enthusiasm, opening its first store in the Real Plaza Salaverry shopping center and, shortly after, the largest store in South America in the Jockey PlazaHowever, fierce competition with fashion giants like Zara and H&Mcoupled with the economic crisis generated by the COVID-19 pandemic, has been a difficult burden to bear.
The COVID-19 pandemic hit many industries hard, and the fashion sector was no exception. Forever 21, which was already facing financial difficulties globally, was unable to sustain the sales levels necessary to remain in the Peruvian market. Despite its strategies, the brand was unable to reverse the decline in its revenue. In comparison, competitors such as Zara and H&M have maintained sustained growth, expanding their presence in the country.
Financial crisis at Forever 21: what will happen to its stores?
The financial crisis Forever 21’s bankruptcy is not a recent phenomenon. In 2019, the company filed for bankruptcy in the United States and was acquired by Authentic Brands Group (ABG) for $81 million. Despite ABG’s efforts to revitalize the brand, the results have not been as expected. Jamie Salter, CEO of ABG, acknowledged in January that the purchase of Forever 21 was a significant mistake. This situation led to the partnership with Shein, the Chinese online fashion giant, in an attempt to improve the brand’s financial situation.Go to Post
In Peru, the impact of these difficulties has been felt with the closure of the flagship store at Jockey Plaza, a 3,200-square-meter establishment that was once the pride of the brand in South America. In addition, the store at Real Plaza Salaverry, which is still operating, will also close its doors in the coming weeks. The liquidation of inventory, with aggressive discounts, is a clear sign of the end of an era for Forever 21 in the country.
Forever 21 is liquidating its clothes
The liquidation process of Forever 21 in Peru has been one of the most visible measures of its withdrawal. With discounts of up to 60% and garments sold for less than S/ 10, the brand has sought to sell out its inventory quickly. These promotions have attracted many customers looking for deals, but they have also marked the end of a nearly decade-long presence in the Peruvian market.
In Lima, the store of Royal Salaverry Square has started its liquidation process, offering significant discounts on the remaining products. Likewise, the store in Jesús MarÃa has also launched various promotions with discounts of up to 50%.
Source: Larepublica
Alia is a professional author and journalist, working at 247 news agency. She writes on various topics from economy news to general interest pieces, providing readers with relevant and informative content. With years of experience, she brings a unique perspective and in-depth analysis to her work.
