Forever 21 Bankruptcy: What It Means For Remaining CT Stores

CONNECTICUT — Though Forever 21 stores remained open for business in Connecticut this week, the discount clothing chain that's been a prominent mall feature for years appears to be ending operations in the United States after initiating voluntary Chapter 11 bankruptcy proceedings, officials said in a news release.

Three Connecticut stores began the closing process after a February precautionary announcement, which left four more floating in a sea of uncertainty, which has now turned into doom. Here is the scenario from last month into this week:

• Manchester, Buckland Hills mall: Shoppers and mall walkers have encountered, "Store closing ... Everything must go," placards on the front of the store to begin the week, and a staff member answering the phone said no formal shuttering date has been declared. A staffer answering the phone Tuesday said that, rather than guessing on a final day, customers should "come and see what we got."

• Milford, Connecticut Post Mall: The store was designated to close this spring or sooner and a staffer said there is no formal date on the calendar.
• Waterford, Crystal Mall: The store will close "whenever we sell out" of sale inventory, a staffer said last month.

• Mashantucket: A staffer last month would not commit to a closing announcement and classified the current sale as "a liquidation" of an abundance of merchandise. It will now be affected by the bankruptcy proceedings.
• Farmington/West Hartford: Westfarms mall: The store was staying open through the initial process, but will now be part of the bankruptcy fallout.
• Trumbull Mall: The store is "not closing," a staffer said last month, but will now be affected by the Chapter 11 process.

Thus, stores will remain open for now, but the company will begin liquidation sales with the intention to close all locations if there is no potential buyer, according to the news release.

"Following the conclusion of our strategic review and after careful deliberation, we made the decision to file for chapter 11 to implement a court-supervised marketing process to solicit a going concern transaction, and, in the absence of such an arrangement, an orderly wind down of operations," company officials said.

The company also filed for bankruptcy in 2019, but survived.

"While we have evaluated all options to best position the company for the future, we have been unable to find a sustainable path forward, given competition from foreign fast fashion companies, which have been able to take advantage of the de minimis exemption to undercut our brand on pricing and margin, as well as rising costs, economic challenges impacting our core customers, and evolving consumer trends," Forever 21 Chief Financial Officer Brad Sell said.

He added, "As we move through the process, we will work diligently to minimize the impact on our employees, customers, vendors and other stakeholders."

Forever 21's locations outside of the United States are operated by other licensees and are not included in the chapter 11 filings, officials said.