Internal Analysis of Forever 21’s Failure in China

Abstract

Forever 21’s bankruptcy sent an alarm to other players in the fast fashion industry. It failed because of its blind adherence to its outdated tactics and misinterpretation of the changes taking place in the industry. It mistakenly assumed that the fast fashion business always stays the same even though it operates in a sector that has one of the fastest-paced changes. Thus, a reflection on Forever 21’s failure is a necessity before any one of the fast fashion brands treads on its heel. This study tries to provide an internal analysis of its failure in China. This study is divided into four parts. Part one is a general introduction, including the background and significance of the study. Part two is an analysis on Forever 21’s failure based on its unique SPA business mode. The internal analysis is separated into two parts, front and back ends, with an aim to provide a deeper knowledge on its production cycle. Part three introduces some recommendations to other industry players from three dimensions, including sustainability, strategies and design. Part four covers conclusions.