NEW YORK, United States, The fast fashion retailer is the latest in the game to prepare to file for bankruptcy not far after Barneys New York filed earlier this month. Barneys then went to close over half of its 22 locations.
Fast fashion is slowly taking a downhill slope with talks of sustainability within the fashion industry being on the rise.
Bloomberg was the first to report the latest news about the franchise. “The company has been in talks for additional financing and is working with a team of advisers to help restructure its debt, but negotiations with possible lenders have so far stalled.”
With negotiations of trying to avoid the shutdown of the franchise, talks of closing some of its 815 stores across America, Europe, Asia and Latin America are in the air.
According to Bloomberg, Forever 21 hired a team of advisers to help restructure its debt and has been in talks for additional financing, but negotiations with possible lenders have stalled.
So what does this mean? And why does this matter?
1. Carbon footprint and waste.
The fashion industry produces 4% of the world’s waste which is around 94 million tons of waste a year.
Climate change is a continuing topic of discussion that we can no longer avoid. Fashion can be sustainable, the industry just needs to agree on ways to do it. Zara is a prime example of a fast fashion company that is going 100 percent sustainable.
2. Old Business Models aren’t working.
Technology and data collection can help with companies being able to sell more and waste less money, time, designs on products that aren’t selling. Companies can use the data that they have to bring specific products to specific stores to specific cities. Analytics and data collected can also be used for trend forecasting, which can be less accurate but is still useful.
Is this the end for fast fashion brands? Charlotte Russe was on the same boat and recently shut down all of its stores. JcPenney and Macy’s were there as well. Even bridal shops like David’s Bridal shut down some of its stores recently.
Fashion will always be there, I believe we’re moving towards a more convenient, and direct brand to consumer business model. I believe online shopping is becoming more the norm. Fashion Nova is an example of a brand that is able to be successful without the use of a physical store. The fast fashion brand was the most searched fashion brand in 2018 and was in fourth place beating out Chanel and Dior in 2017.
Via The University of Queensland
New York Fashion Week (NYFW) is coming up on September 6th-14th, sustainability will be a topic that is on everyone’s mind.
Even Vogue’s Editor in Chief and Artistic Director for Conde Nast, Anna Wintour talked about sustainability in a podcast with The Economist.
“Every CEO in the world of fashion or the world of beauty, that one talks to today is aware. And I’m not sure if I would call it a guilty conscience. I just think that people with a conscience and with the ability to make a change and they are all working towards sustainability and solving the problem at hand.”
This is an on-going story with few updates. Forever 21 declined to comment to Bloomberg and CNBC.