Forever 21 Files for Bankruptcy Again
The US operating company for Forever 21 filed for bankruptcy on Sunday, Mar. 16 for the second time in six years.
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The company is planning to reduce its domestic operations and put the onus for bankruptcy on higher costs and companies taking advantage of duty-free treatment of low-cost packages from China, which have undermined the fast-fashion retailer.
The US waivers tariffs and custom procedures on imported items shipped to individuals that are worth less than $800, which helps Chinese online retailers like Temu and Shein to keep prices for their items extra-low.
US President Donald Trump stopped his administration's repeal of the clause in February, after rapid changes created disruptions.
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Forever 21 declared bankruptcy with $1.58 billion debt after losing over $400 million during the last three years.
The fast-fashion retailer lost $150 million in 2024 and was expected to lose approximately $180 million in 2025, according to documents filed in a Wilmington, Delaware bankruptcy court.