US fast-fashion retailer Forever 21 has decided now is the time to make a grab for a slice of the high street
Forever 21 is the latest big name from across the Atlantic lining up to try its luck with UK shoppers. The 460-strong US fast-fashion chain’s ambition is to debut with a large statement store on London’s Oxford Street to rival high street icon Topshop.
Forever 21 has been eyeing up the UK for some time and has been linked with London locations including Regent Street, Covent Garden and Westfield London, but so far has not signed a deal. But the recession is forcing down property prices, costs that previously hindered some international retailers from taking prime UK locations.
Forever 21 is already taking advantage of more favourable lease terms in the US, targeting larger department store spaces in order to increase its store sizes. The business is opening a minimum of 25,000sq ft in prime locations in major US cities with a rollout of its larger format Forever XXI stores. There, Forever 21’s mix of trend-led fashion and affordability focuses mostly on womenswear but has a growing menswear offer which gives it a clear and distinct customer proposition.
While Forever 21’s entry to today’s gloomy UK high street may brighten the market, the retailer will have its work cut out in carving a niche in the UK, one of the world’s most competitive markets. Fast fashion at the lower end of the price spectrum is well established, with the likes of Primark, New Look, H&M, Zara and Topshop leading the way.
Management Horizon’s Edward Whitefield says: “This move to Europe has been five years in the making. The retailers it is likely to hit will be core competitors New Look and H&M, while the price points will be close to H&M. Forever 21 has its own design team and like H&M it relies a lot on driving design and sourcing in lower-cost markets.”
Whitefield says the US retailer will have to improve its in-store experience to compete in the UK. “The Forever 21 product is better than its store design, which it will have to think about, as we [the UK] have some smart shop designs which add value for the shopper.”
It remains to be seen how Forever 21 will translate to the UK and what changes it will make to compete in what is a very competitive fast-fashion arena. US retailers have traditionally sold their product at prices that are comparatively higher for UK shoppers, with a straight US dollars for pounds conversion. And sizing and editing ranges will also have to be tweaked to suit the UK market.
However, the first step is to find the right store, and Forever 21 has hired retail property agent Harper Dennis Hobbs to scout for sites. Wherever it makes its UK debut, the retailer’s young customer base and value pricing architecture could make it an opportune time to try its hand here.
Forever 21 essentials
Stores 460 stores in 13 countries
Store formats Forever 21 (fast fashion), Forever XXI (large flagship), For Love 21 (accessories)
Brands Mostly own label - Forever 21, Heritage 1981, Twelve by Twelve and plus-size label Faith 21
Turnover USStory text.8 billion (£1.16bn) in 2008 predicted to rise to up to .5bn (£1.6bn) for 2009
Key price points
Graphic T-shirts USStory text4.90 to USStory text8.90 (£9.70 to £12.40)
Skinny jeans USStory text9.90 to US2.90 (£13 to £15)
Dresses USStory text6.90 to US4.90 (£11 to £16)
Woven tops USStory text4.90 to US2.90 (£9.70 to £15)