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Forever 21 could make a UK comeback, says industry

Young fashion retailer Forever 21 has the potential to relaunch and make a “fresh start” in the UK under its new owners, the industry has told Drapers. 

Authentic Brands Group (ABG), which owns Juicy Couture, Barneys and Tretorn, and two US landlords have purchased Forever 21 for just over $81m (£63m).

The new ownership group will work with existing and new partners to expand Forever 21 across key territories, including South America, Western and Eastern Europe, China, Southeast Asia, Middle East, and India. An ABF spokeswoman said there is a “very strong opportunity” to open new stores in the UK and other territories.

There is no current Forever 21 business in the UK. It was shut down as part of the company’s chapter 11 bankruptcy reorganisation toward the end of 2019. There were three UK stores at the time of the filing. 

Historically, the UK had as many as eight stores, including Birmingham Bull Ring, Oxford Street, Church Street, Stratford City, Buchanan Street, Lakeside, Bluewater Shopping Centre and Trafford Centre.

Industry experts cited stock issues and an over-expansion of large format stores for its downfall. 

“Forever 21 had a strong brand image and had a dedicated customer base”, one fast fashion supplier said. “Then they over-bought and ended up with stock issues – out-of-date buying methods whereby they pushed the stock onto customers rather than pulling the real sales information from the customers.”

One former Primark head office employee said: “The company expanded too quickly in the UK and had too many large-format stores in shopping centres with reduced footfall.” 

Several retail sources believe there is potential for Forever 21 to make a comeback in the UK. 

Retail analyst Richard Lim said. “The new ownership gives Forever 21 the opportunity to try to start again with a clean slate in the UK. They do have a recognisable brand and brand equity. However, if they decide to relaunch in the UK, they have to get it right.”

He added: “What’s challenging is the apparel market is such a difficult market to operate in the UK at the moment. There is serious competition from online retailers Boohoo, Missguided, In The Style, etc, as well as DTC brands making headway in that area too. Then there are also rivals like Primark and Zara.”

“What relaunching over here would allow Forever 21 to do is construct a sensible property strategy, which would be to be incredibly selective over what stores they want to open in the UK. They will have an opportunity and advantage over other legacy brands, which don’t have that advantage to be able to negotiate on favourable terms with lower rents, shortage leases with break clauses.”

“This could be a fresh start for Forever 21 in the UK.”

Retail analyst Mark Pilkington agreed: “I think there is an opportunity for Forever 21 in the UK if they open on a smaller footprint –  not having huge stores. It could work with smaller stores, which don’t offer the full range and don’t fill the place up with stock. They can do a lot of shipping from the warehouse that they don’t have in the store. The need high service and high-quality staff to be able to work over here.”

The former Primark head office employee said to succeed in the UK, Forever 21 needs to find its gap in the market: “If Forever 21 decides to relaunch in the UK, it will need to begin with pop-up stores to get a feel for what customers want. It should also launch online first – it could become the Primark of online.

“They need to differentiate themselves, find out who their customers are. There could be a place for it if it differentiates from when they were in the UK previously.”

She added: “It’s certainly a risk, but I think it could pay off.”

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