Forever 21 was a growing fashion store for ladies and in America it was a brand for young ladies who wanted to be associated with fast fashion, class and good looks but in 2019, the company filed for bankruptcy and even started closing down stores.
As a fast brand that was gaining attention in the United states, the owners thought it was best to open other branches internationally and within a short period they had lots of branches in other countries, the problem was that the band was only popular in America so in the other locations, the company was not able to generate the type of traffic it was generating in America and the company continued to put in lots of money into opening other branches that were not bringing in profit for the company.
Forever 21 is a reputable company which could be regarded as been a family business, it was after the generation of a huge amount of sales in their first year that the CEO had called on other family members to help them open other branches globally, by the time the company filed for bankruptcy, they had almost 800 stores and they had spread their wings through 40 countries and 5 continents.
If you ask me, I will say it is a good idea to desire growth (maybe because I am not so good with business), but maybe the company would have just taken a little bit of time to understand what the returns were instead of the continuous pumping of funds and expecting profit in the future. The fashion world changed and different fashion styles came out more than before which made it difficult for fashion 21 to provide each of this styles in their numerous shops globally and gradually from being a company that could provide class through fashion, it began to sell just old items.
My Opinion.
I really think this is something a lot of entrepreneur needs to learn from, I was reading one of the writings by a member of project.hope and he wrote that expansion was really a good thing to do but before expanding it is important to know what we are getting into. Forever 21 was so keen to grow and grow very fast that they failed to look back on where they are headed so new stores were being opened almost every six months, expansion is not bad but progress really needs to be monitored.