Forever 21 Files For Bankruptcy
Forever 21 filed for bankruptcy protection yesterday, joining TopShop and other victims of the retail apocalypse.
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Europe and Asian markets will be widely affected by the closure of hundreds of Forever 21 stores after the U.S. based retailer filed for bankruptcy protection last night. With 800 stores worldwide, the chain secured $350 million in financing to fund its restructuring, which will see it remain unaffected in Latin America.
The chain once welcomed flocks of teens rushing to obtain its products, but a slowdown in sales in its brick-and-mortar stores has caused serious damage. Forever 21 is not the only store affected by the so-called ‘retail-apocalypse’, as other large companies feel the sting of reduced sales.
Other Retail Apocalypse victims
One company which has felt this more than others is Under Armour (NYSE: UAA), once hailed as ‘the next Nike’, by bullish analysts. The company has fallen on hard times, especially in its retail stores, as it has lost out on the teen market as well as younger adults. Poor investments into fitness trackers and technology caused irreparable damage, which led to its winding down in 2017.
Under Armour planned several initiatives for North America including increased e-commerce investment, but none have yet materialised and growth has ground to a standstill, leaving Under Armour investors concerned for the future.
Another victim of the slowdown in retail spending is similar brand, TopShop, which closed all of its U.S. based stores in May and went into liquidation on the continent. The UK-based parent company, Arcadia Group has been attempting a financial restructuring for several months now.
Nike Bucks the retail trend
Nike (NYSE: NKE) on the other hand, has gone from strength to strength, bucking the trend of declining retail markets. Popular among a range of demographics with an old and trusted brand, Nike’s stock is on the rise, hitting all-time highs this month with a stock price of $90.