| Pub. Date | : Mar' 2021 |
|---|---|
| Product Name | : The IUP Journal of Case Folio |
| Product Type | : Article |
| Product Code | : IJCF40321 |
| Author Name | : Faria Zafar and Indu Perepu |
| Availability | : YES |
| Subject/Domain | : Management |
| Download Format | : PDF Format |
| No. of Pages | : 15 |
Forever 21, a US-based fashion retail brand headquartered in Los Angeles, California, was started by a South Korean immigrant couple, Jin Sook and Do Won Chang, in 1984. Forever 21 was a forerunner in the fast fashion industry and, spurred by its initial success, it started opening new stores at frequent intervals. But on September 29, 2019, Forever 21 filed for Chapter 11 bankruptcy protection to restructure its business. The company said, “We do however expect a significant number of these stores will remain open and operate as usual, and we do not expect to exit any major markets in the US.” The company had 549 stores in the US and 251 stores in other countries at the time of filing bankruptcy. The company said it planned to “exit most international locations in Asia and Europe” but would continue to operate in Mexico and Latin America. It was expected to close up to 350 stores worldwide, including 178 stores in the US. A Forever 21 spokesperson said the retailer expected to have between 450 and 500 stores globally after this process. The case discusses the origin and growth of Forever 21, and the factors that led to its downfall—rapid expansion, global recession, retail apocalypse, and changing consumer preferences.
On April 18, 2018, US multinational FMCG major Procter & Gamble Company (P&G) acquired a 100% stake in the Consumer Health Business (CHB) of Merck KGaA (Merck), a global pharmaceutical company headquartered in Germany. David Taylor, Chairman of the Board, President and Chief Executive Officer of P&G, said, "We like the steady, broad-based growth of the OTC Healthcare market and are pleased to add the consumer health portfolio and people of Merck KGaA, Darmstadt, Germany, to the P&G family."2 Stefan Oschmann, Chairman of the Executive Board and CEO of Merck, said, "Consumer Health is a strong business that deserves the best possible opportunities for its future development. With P&G we have found a strong, highly recognized player who has the necessary scale to successfully drive the business going forward."3
Forever 21 gives hope and inspiration to people who come here with almost nothing.1
-Don Won, Founder, Forever 21.
This was an important and necessary step to secure the future of our company, which will enable us to reorganize our business and reposition Forever 21.2
-Linda Chang, Executive Vice-President, Forever 21.
Bankruptcy may be the only way to salvage the brand, where they can basically follow the shrink to grow strategy.3
-Craig Johnson, Founder, Customer Growth Partners.