BUAD 497: Strategic Management -Selected a struggling company. Identified its key strategic problem. Conducted industry & Internal company analysis. Provided strategic recommendations and implementation. Class Concepts: Sustainable Competitive Advantage, Porter's Five Forces, Disruptive Innovation, PESTEL Framework, Multi-Sided Platforms, VRIO Framework, Corporate Social Responsibility, Creating Shared Value

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Nathan Yung
Professor Melody Chang
BUAD 497
28 November 2022
Forever 21: Rebuilding the Broken “American Dream”
Introduction
In 1984, an immigrant couple from South Korea–Mr. Do Won Chang and Mrs. Jin Sook Chang–
founded Forever 21–a fast fashion retail company based in Los Angeles, California. Mr. Chang
named the brand Forever 21 because 21, according to him, is “the most enviable age”
(Maheshwari, The New York Times). The retailer thrived throughout the early 2000s, with its
mass-produced clothes proving popular among young customers on a budget (Basiouny). At its
peak, Forever 21 was operating with over 43,000 employees worldwide, gathering approximately
$4.4 billion in annual sales (Wang). The media portrayed the Changs as the representation of the
“American dream–”the protagonists of an immigrant success story (Maheshwari, The New York
Times). As though to bolster this image, Mr. Chang spoke to the Los Angeles Times in 2010
about the value Forever 21 held–that is, giving “hope and inspiration” to other immigrants like
Mr. Chang himself (Bensinger).
However, the “hope and inspiration” turned into devastation when the company’s aggressive
expansion in real estate led to a downfall. In the years before and after the recession, Mr. Chang
pursued his ideal objective of “having really big stores” by opening up colossal flagship stores
both in and out of malls (Maheshwari, The New York Times). Though a dream come true, this
decision lacked realistic vision, as the gigantic spaces were difficult to fill on time with new
garments. Online shopping was disrupting the market, causing countless brick-and-mortar
stores–and even malls–to close (Maheshwari, The New York Times). And, notwithstanding these
problems, Forever 21 was stuck with abnormally long leases (Maheshwari, The New York
Times). Eventually, in 2019, the retailer filed for bankruptcy (Thomas). In the subsequent year,
the company was sold for only $81 million to the new owners–Authentic Brands Group, Simon
Property Group, and Brookfield Property Partners (Sachmechi). Now, in the hands of these three
owners, Forever 21 is aspiring to resurrect under the guidance of the new CEO, Winnie Park
(Lau; refer to Exhibit A for a timeline with additional facts).
How should CEO Park successfully achieve this resurrection? In this paper, our team provides
realistic recommendations by identifying the key strategic problem of the current Forever 21.
First, we analyze the company externally and internally by using various frameworks–Michael E.
Porter’s Five Forces, Business Canvas Model, and more. From these analyses, we spotlight the
major problems of the company: deficient investment in e-commerce growth and wrong focus on
expanding the in-person consumer experience and overlooking sustainability in fashion. Then,
we conclude that these issues are, essentially, lingering remnants of the company’s previous
failure–that is, due to its initial absence of strategic planning, the company constantly gets behind
the industry trends that are valued by its target consumers. Hence, the most crucial problem the
company must currently resolve is overlooking the needs of its major consumer segment, and we
suggest corresponding recommendations for implementing market research. Since Forever 21 is,
in real life, attempting to return to the market after falling apart due to expanding without
developing strategies, our team believes that the choice of the company for this paper is
particularly intriguing. Our in-depth analyses and subsequent recommendations will offer

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practical help to the company. To prevent another financial destruction and make a successful
comeback to the market, the executives and investors of the company should consider our
examinations.
Industry Analysis: Fast Fashion Retailers
Our team provides the following industry analysis based on Porter’s Five Forces framework and
the PESTEL factors (Exhibit B):
Threat of New Entrants: Low to Moderate
The fast fashion industry is highly competitive, yet the threat of new entrants is low to moderate
for the following reasons: first, entering the industry is capital intensive, as companies need to
build infrastructures and distribution networks–building stores, managing inventory, hiring
designers and employees, finding suppliers, and more. The industry also relies on demand-side
economies of scale since the more customers wear clothes from a certain brand, the more
potential buyers are exposed to this brand. These network effects further lead to a high
incumbency advantage, as consumers are more likely to purchase from brands that are easily
recognizable, and their peers are already familiar with. Last yet not least, the switching costs are
very low, as fast fashion brands–unlike their high-end, designer counterparts–lack identity and
are easy to replicate. The replicable products mean consumers focus on what brand has the
cheapest products and are thus easy to switch between brands based on price. On the other hand,
since it is easy to produce designs, it does not require a massive creative force to launch a fast
fashion brand, attracting new entrants. Thus, the threat of new entrants is not entirely low but
low to moderate.
Supplier Power: Low
Usually, larger suppliers are able to negotiate more effectively than smaller suppliers. However,
huge fast fashion companies hold greater power than these suppliers since these retailers can
easily switch to the most cost-effective supplier. The switching costs are even lower if the
competition between suppliers is high: for example, Zara has 1,866 suppliers and 7,323 factories
around the world (Gestal). In addition to the low switching costs, fast fashion retailers purchase
in large quantities to achieve a relative price advantage. The suppliers are also not offering
differentiated products, making it easy for retailers to switch between suppliers.
Buyer Power: Very High
As discussed regarding the threat of new entrants, consumers of fast fashion businesses are price
sensitive, holding the power to not purchase expensive clothes and to easily switch between
retailers. Products take over a big proportion of sales while yielding low profitability, further
causing buyers to be price sensitive. Consumers have little incentive to stay loyal to fast fashion
companies, which produce replicable designs and thus lack a strong brand identity.
Threat of Substitutes: Moderate
Target consumers of the fast fashion industry are price sensitive and so will likely not search for
more expensive substitutes from a different industry, like clothes from designer boutiques.
However, it is likely that if fast fashion retailers solely focus on meeting the demand for price
and offer products that are excessively low-quality, consumers may turn to substitutes that are
made of more trendy designs and sophisticated materials. Moreover, consumers are now looking

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into sustainability: a recent article from Forbes refers to the report published by First Insight and
Baker Retailing Center to state that for two years since 2019, Gen X consumers’ preference to
purchase from sustainable brands increased by approximately 25% (Petro). These consumers’
willingness to pay more for sustainable products increased by 42%; in fact, consumers across all
generations are, according to the article, willing to spend more for sustainable products (Petro).
Additionally, higher-end brands, like Marc Jacobs, Dior, Fendi, and Ralph Lauren, have been
presenting a new, tech-savvy format of presenting products, letting customers virtually try on
their clothes (Fashion 360 Magazine). If brands start applying this technique to sell their clothes,
current fast fashion customers–despite their price sensitivity–may choose this way of shopping to
prevent the inconvenience of returning or exchanging products in the future. For these stated
reasons, the threat of substitutes is moderate.
Rivalry: Very High
Fast fashion retailers face high competition. The industry is already full of well-established
competitors, such as Zara, H&M, and SheIn with 2021 revenues of 27.72, 23.07, and 15.7,
respectively, in billions of dollars (Exhibit C). The exit barriers are high since unsold clothes will
create inventory problems. Fast fashion retailers lack differentiation in largely produced clothes
and yield high fixed costs yet low switching costs and marginal costs, so the price competition is
extremely high.
PESTEL Factors
Our team further applies the PESTEL framework to identify causes of trends that may influence
the industry. We look at factors from the external environment: first, politically and legally,
governmental regulations have been created and enforced to make the fashion industry more
accountable. The recently passed Fashioning Accountability and Building Real Institutional
Change–famously, FABRIC–Act of 2022 aims to improve the labor rights of garment workers
(Paton). Socioculturally and ecologically, consumers have been raising awareness about
sustainability, discussing the harmful effects of unendurable materials. As underscored above,
the Forbes article refers to the study by First Insight and Baker Retailing Center to show how
across generations, customers are willing to pay more for sustainable alternatives (Petro). This
trend is shown in digital consumption as well, as online shoppers are keen to find more eco-
friendly products (PricewaterhouseCoopers). To explicate more about digital consumption from
a technological perspective, an increasing number of customers have been shopping online now–
even more than during COVID-19 lockdowns, when e-commerce grew significantly (Morgan).
Many fashion websites have responded to such change by investing in creating convenient
shopping websites as well as techniques like the virtual try-on experience discussed in Threat of
Substitutes. Last but not least, the growth of e-commerce during COVID-19 lockdowns in
comparison to the decline of offline sales demonstrates that the state of the economy influences
the sale rates of retailers (Morgan).
Based on this in-depth industry analysis, the fast fashion retail industry does not seem attractive
to new entrants since large players with strong finances will easily win over the price
competition and invest in new methods, like the tech-savvy format of presenting clothes, to
attract customers. Hence, Forever 21–holding a position similar to a start-up, as it is trying to
resurrect from bankruptcy with the latest reported revenue of $3,404,569 and a net loss of
$607,475 in 2019–faces severe competition (Exhibit D). Especially now, more consumers value

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sustainability than price, and Forever 21 is not effectively responding to the trend: apparels made
at Forever 21 are almost entirely made with synthetic fabrics, which are not biodegradable nor
can be recycled after use (Gonikberg). According to an investigation by the Los Angeles Times in
2017, one Forever 21 worker produces up to 700 shirts a day, which totals insuperable volumes
of textile pollution every year (Kitroeff and Kim). Without proper resolutions based on market
research on consumers’ needs, Forever 21 and its current competitive positioning of low-cost
strategy will not be sufficient to sustain the company in the highly competitive industry.
Internal Company Analysis
To examine Forever 21 internally, our team first applied the Business Model Canvas (BMC)
framework to identify how the company creates value for itself and its customers–or, since
Forever 21 holds a position similar to a start-up, to identify how the company can choose its
customer segment to maximize its value proposition (Exhibit E). In achieving this identification,
we first highlight from BMC’s 9 factors the Value Proposition: in its “About Us” statement,
Forever 21 claims to produce trendy and unique clothing while supporting e-commerce
innovation (Exhibit F). However, this statement is questionable considering how the fast fashion
retailer sells undifferentiated, mass-produced clothes and went bankrupt due to its wrong focus
on brick-and-mortar expansion instead of growing its e-commerce. Moreover, while other
companies, like Zara and H&M, promote their attempts for sustainability by implementing
relevant actions–like in-store recycling initiatives–Forever 21 does not, nor is it putting any
distinguishable efforts, as underlined in Industry Analysis (Gould). Other points from Value
Proposition show that the company claims to uphold values about the immigrant success story
and the “enviable age” of 21, yet it is difficult to deduce how these values have been translated
into the brand’s clothing designs or the overall identity: for instance, Forever 21 does not
produce designs that were inspired by Korean fashion or are preferred by customers around 21
years old, as the company has started straying away from the target market and producing
clothing for women of all ages (Osman).
Another factor to note from BMC is the lack of customer engagement in Key Activities,
connected to Customer Relationships and Customer Segments. While Forever 21 offers heavy
discounts and lets customers review their products on its official website, the retailer is behind in
the industry-wide trend of employing brand ambassadors and bringing in social media
interactions. This insufficient online presence is particularly problematic since the company’s
main customer segment–though the company is moving away from this segment–are young
women who determine where to shop based on virtual exposure to brands. This point regarding
e-commerce further leads to the last factor we emphasize from BMC: leasing from the Cost
Structure. As pointed out in Introduction, Forever 21 set itself up for long leases through the
hostile entrance into malls and other huge stores, whereas competitors benefitted from growing
their businesses online. Recently in October, the company announced that it would restart this
physical expansion by opening up 14 new stores across the country (Barkho). Such
announcement should concern investors, as the company will be walking into another round of
unbreakable, years-long leasing contracts while not having improved its virtual presence.
Since Forever 21 is not a publicly traded company, we lack proper information regarding who
the company’s key stakeholders are. We, therefore, find BMC more useful than Value Chain
Analysis (VCA), another framework frequently exploited for internal company analyses. Yet our

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team still pinpoints from VCA a few factors to address limitations the company faces regarding
Human Resource Management and Operations (Exhibit G). As analyzed for PESTEL Factors,
legal actions–like the FABRIC Act of 2022–have been enforced to ensure that employees work
under reasonably safe conditions. These actions have been receiving support from society, as
more consumers yearn to see justice in fashion: Fashion Revolution is, for example, a movement
demanding transparency in the industry (Exhibit H). According to an investigation by the Los
Angeles Times in 2017, however, since 2007, workers have been filing claims against Forever 21
for back pay (Kitroeff and Kim). Factories and manufacturers have spent hundreds of thousands
of dollars on settling these claims, whereas the company itself–Forever 21–has not paid a cent.
For this reason and other sustainability reasons highlighted in Industry Analysis, Forever 21
received a score of 0-10% in the Fashion Revolution’s Fashion Transparency Index, which
underscores that the brand’s supply chain is not certified by labor standards that guarantee
workers’ wage, health, and safety (Fashion Revolution). In addition, connecting Operations with
the point above about leasing, the company has been physically expanding and confronting
difficulties quickly filling in large stores with trendy designs on time (Maheshwari, The New
York Times). The company, therefore, reported a loss of $493,362 from its operations in 2019
(Exhibit D).
Finally, to assess whether Forever 21 carries a sustainable competitive advantage, we applied the
Valuable, Rare, Imitation Costly, Organized to Capture Value–shortly, VRIO–framework. First,
Forever 21 is valuable for providing trendy and extremely low-cost clothing that its target
customers need. Compared to other fast fashion retailers, Forever 21 does sell its products at
much cheaper prices: Zara sells its products at the average price of €35.90, and H&M, €26.20,
whereas Forever 21 usually sells around $1.80 for camisoles, $7.80 for jeans, and $3.80 for T-
shirts (Alonso; Maheshwari, Buzzfeed News). Despite this value, the product designs of Forever
21 are neither rare nor imitation costly, as the fast fashion brand does not employ a
differentiation strategy. Thus, Forever 21 is stuck with competitive parity and needs quick design
changes to create a temporary competitive advantage.
With these internal evaluations of the company using various frameworks from BMC to VRIO,
our team concludes that Forever 21 needs to follow up with its value proposition by focusing on
the main customer segment–young women–rather than moving away from them. It is not that the
company lacks a clear value proposition. The company does present a strong mission statement
and has promoted through interviews and its name itself the values it holds: an immigrant CEO
achieving success by creating a brand that produces trendy clothing for women who want to stay
in youth through fashion. What the company needs is, rather than re-creating this value
proposition, researching the needs of its major consumers and focusing on creating products
based on the research results. Since these consumers are young women sensitive to online
presence and social movements, the company should accordingly invest in enhancing virtual
exposure and promoting sustainability and transparency rather than physical expansion, which
has cost them a tremendous operational loss. Further analyses of the problems and corresponding
recommendations will be provided in the subsequent sections.
D. Key Strategic Problems
Based on our analyses from the previous sections, we highlight the following three problems, the
last of which we consider as the most urgent and critical:

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1) Wrong Focus on Brick-and-Mortar Expansion and Lack of Investment in E-Commerce
As pointed out throughout the paper, Forever 21 put a wrong focus on physical expansion and
overlooked the industry-wide growth of e-commerce. Even when surveys and studies, like the
First Insight report, demonstrated that millennials were moving towards online shopping in the
US, the company insisted on its in-store expansion strategy: Forever 21’s aggressive store
expansion–going from 7 to 47 countries in a span of 6 years while attaining increasingly larger
stores–accounted for its inability to react to changes in market direction (Osman). Its stores in
Canada, Europe, and Asia lost approximately $10 million per month (Osman). The company
ultimately faced poor margins and low profitability. The complexities of expanding so quickly
globally, furthermore, gave rise to difficulty in catering to the varied needs and tastes of
customers in different countries.
High operational costs were incurred to maintain the large stores and excess inventory caused
stress on the company. Increased rental expenses ate up to 30% of revenues (Osman). The
company suffered a loss from operations of $212,328 in 2018 and that of $493,362 in the
subsequent year (Exhibit D). During the 3 years leading to its bankruptcy, Forever 21 launched
600 of its 700 stores in outlet malls contributing to an annual growth rate of 90% (Osman). This
unsustainable growth strategy was too aggressive compared to its biggest competitor, H&M,
whose strategy of steady growth brought about an annual growth rate of 5% and 5000 stores
(Osman).
While Forever 21 suffered from ineptly planned offline expansion, rivals started to emerge into
the online fast fashion retail arena, successfully growing their businesses online. The company’s
inability to stay ahead of the competition was one of the factors of its demise. When social media
started becoming a crucial marketing tool, Forever 21 failed to adapt. Its marketing budget
demonstrates its lack of understanding of the virtual trends: Forever 21 cut down more than half
of its marketing budget in the US, from $800,000 in 2017 to under $344,375 by 2018, and only
$383,000 spent in 2019 (Osman). On the other hand, the other ultra fast fashion retailers’
strengths lay in their quick web design and updates. SheIn, for instance, adds 500 to 10,000 new
items on its websites and app daily (Roll). It is vertically integrated, controlling its own
production chain with its sophisticated internal software integrated throughout its business
(Roll). Optimized with big data, the company understood customers’ habits in real time together
with information on current sales, stock, or demand (Matsakis). These analyses evidence Forever
21’s complacency and absence of foresight in its consumer’s changing needs and tastes,
competitors’ strategies, and the changing market trends towards e-commerce. All these factors
led to the company’s inability to innovate its business model. Competitors were earning 30% of
their revenues through e-commerce while Forever 21 generated half of that at 16% through e-
commerce (Osman).
Other competitors, such as Zara, strive to keep up with their customers by paying attention to the
rapidly changing fashion trends and working towards shorter lead times. Zara produces about 11
thousand styles per year—that is, about 5 times more than a comparable retailer often does in the
fast fashion industry (Fraiman). With the efficiency of their supply chain and distribution
management, physical stores are consistently refreshed with the latest trends based on customer
insights collected daily. Shorter product life cycles also ensure greater success in meeting

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customers’ preferences (Roll). Not placing its customers at the forefront of decision-making in a
business environment where buyer power is high, Forever 21 failed to meet the consumers’
needs.
2) Transparency and Sustainability
Another problem of the company is that it neither internally values nor publicly promotes
ecological sustainability and transparency regarding its labor conditions. Like the problem
above, the lack of transparency and sustainable options at Forever 21 was brought up throughout
the paper. As discussed in Internal Analysis, numerous articles have been published to
denounce the poor working conditions of Forever 21 workers, hundreds of whom have filed
claims against the brand for years (Kitroeff and Kim; Manning). Instead of addressing the
problem, however, the company has pawned off its responsibilities to factories and
manufacturers and even outsourced 60% of manufacturing to Asian countries, where labor law
enforcements are more lenient and costs are lower (Hicken).
Regarding sustainability, as supported by the study by First Insight and Baker Retailing Center,
contemporary consumers–especially the newer generations–yearn for sustainable alternatives
(Petro). Online shoppers are also likely to purchase ecologically considerate products (PwC).
However, Forever 21 has not addressed the ecological problems in fashion, while its competitors
like Zara and H&M have been actively publicizing their environmental commitments: by 2025,
Zara even aims to make all its clothes out of 100% sustainable fabrics; H&M exploits melted
recycled glass with no additional color pigments as well as chunky-soled sandals composed of
Bloom™, a foam partially created with environmental-friendly algae biomass (Conlon;
DeAcetis). Since the target consumers of Forever 21 are young or middle-aged–the major sample
group studied by the First Insight report–they would demand from fashion brands notable
sustainable actions.
3) The Most Urgent Problem: Overlooking the Needs of the Major Customer Segment
While the above two problems pose severe challenges to the company, the most urgent issue to
be addressed is that Forever 21 has been overlooking the demands of the main, targeting
customers. In fact, because Forever 21 lacks research on its customers, it has made wrong
decisions regarding geographical expansion, transparency, and sustainability–all of which are the
factors that its major customer segment of young women values in determining where to
purchase clothing. As briefly pointed out in Internal Analysis, the retailer has been drifting
away from its target audience and rather going for demographic diversification, producing
clothes for all women and men rather than its initial, specific segment. Not only does this
decision blur the value proposition upheld by Forever 21 but also let the brand lose its focus on
strategic plans it should come up with to maintain and attract customers. Forever 21’s lack of
insight into specific customer preferences resulted in losing customers to competitors who
invested resources in analyzing their target market and personalizing offerings. Thus, the
company must first look into researching its target market using appropriate human and
technological resources (further explicated in Strategic Recommendations and
Implementation). With the data collected, the company will be able to reaffirm its value
proposition and make additional adjustments to strengthen its competitive positioning in the
industry.

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Strategic Recommendations and Implementation
As concluded from our analysis in Key Strategic Problems, Forever 21 faces many problems,
yet the most fundamental issue is its ignorance of the demands of the major customer segment.
To resolve, our team proposes that Forever 21 first utilize appropriate human and technological
resources to establish and run a system for market research. Currently, many sources claim
women of different age groups as the company’s target consumers, though all of them do denote
young or middle-aged women as the major market (Maheswari, The New York
Times). By facilitating the research, the retailer will be able to further specify which exact
segment it should focus on. In doing so, the company should also comprehend the current and
prospective wants and needs of this specified segment.
With these collected data, the company should cater its products and services to the demands of
the target segment and reaffirm its value proposition in the meantime. As mentioned in Internal
Analysis, the company has promoted through interviews its values regarding the success of an
immigrant couple and fashionably staying forever at the age of 21. The company also presents a
clear mission statement of producing trendy, unique clothing through e-commerce and in-person
experience. The problem is that Forever 21 has not upheld or utilized the claimed values and
statement in offering its products or services. By meeting the needs of its major consumers, the
retailer will go through numerous customization processes, during which it can implement
changes to revitalize its value proposition.
Finally, the retailer should address points that it has not yet addressed: sustainability,
transparency, and others that may be challenged in the future in the industry. As emphasized
throughout the paper, an increasing number of consumers call for sustainability and transparency
in the fashion industry. While addressing such problems is important, it is equally pertinent to
consider what other PESTEL-related issues may arise and disrupt the market. Without predicting
and preparing for this disruption, Forever 21 will sink back into its former failure, which was
caused by a lack of foresight and strategic planning.
To facilitate these three recommendations, Forever 21 should follow this implementation plan:
first, organize a customer service team of representatives and analysts and a Chief Customer
Officer (COO) as well as a marketing division of data analysts and a Marketing Director. The
customer service team can run surveys to collect and organize data from interacting with its
current and potential consumers and report to the COO. After reviewing, the COO can share
these findings with the marketing department, whose data analysts will run technological
examinations to specify the target market and its needs. The analysts can report the findings to
the Marketing Director, who can oversee the process and provide feedback. The collaboration of
the two groups will bring about synergy effects and find the needed information to determine the
major customer segment and its needs.
Then, Forever 21 should customize its products and services to meet the needs of the specified
consumer group. As many sources highlight, it is likely that the specified consumer group–
though yet unknown–will be young females preferring to shop online. The company must,
therefore, create unique and youthful designs, as promoted in its mission statement and
interviews. As underlined above, Zara creates 11,000 new styles per year, and SheIn adds 500 to
10,000 new items on its websites and app per day. Forever 21 should facilitate the creation and

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sale of styles at the same or higher speed. To do so, the company can have its customer service
analysts cooperate with vendors and designers while investing in IT for smooth operations and
management. The analysts will quickly spot online and offline what trends exist among its target
customers. The analysts will, then, report the data to vendors, who can create designs
accordingly. If needed, the retailer should consider increasing the number of vendors that it
collaborates with. Furthermore, Forever 21 currently purchases clothes from vendors, yet it can
establish a team of designers to create clothes inspired by the trends analyzed by customer
service analysts. To manage these quickly produced clothes, the retailer should invest in IT for
smooth warehouse and in-store operations, from which tremendous losses previously incurred
(Exhibit D). The website management team will also need technological support for adding the
items on time and receiving orders. IT could also offer help for web design, which should remain
fashionable, as the retailer is competing in an industry where visual aesthetics are pertinent to its
positioning. With these steps, Forever 21 will be able to follow up with its claimed values and
mission statement, revitalizing its value proposition.
Now that it has followed up with its value proposition, Forever 21 should add further values like
transparency and sustainability. The retailer should invest in expanding its legal team to oversee
the working conditions and payment procedures of employees. Publicizing this change as well as
the overall overseeing process will help Forever 21 rebuild its reputation as a transparent retailer.
The company should further find manufacturers that utilize sustainable materials that are less
harmful to the environment than its current synthetic fabrics. Lastly, while our team has provided
strategic planning based on the current and prospective trends, Forever 21 should set up a team
of strategists within the company to predict potential disruptive technologies in the industry.
Following these recommendations, Forever 21 will not only resolve its most urgent problem of
overlooking the target customer segment but also other two problems of lack of investment in e-
commerce and bypassing sustainability and transparency (for this reason, an additional appendix
for the two other strategic problems is not provided in the paper). Since the fast fashion retail
industry is severely competitive and unattractive, our team believes that Forever 21 needs to
facilitate as soon as possible apt strategic resolutions. Otherwise, its low-cost strategy will not be
sufficient in sustaining its competitive positioning in the rapidly-changing industry.

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Appendices
Exhibit A. Timeline of Forever 21 with Additional Facts
Source: Osman, Mariam. “Forever 21: The Failed American Dream.” Medium, Waterloo
Business Review.

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Exhibit B. Porter’s Five Forces Framework

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Exhibit C. Table of Revenues for Competitors: Zara, H&M, SheIn
Fast Fashion Brand 2021 Revenue (in billions of USD)
Zara 27.72
H&M 23.07
SheIn 15.7
Sources:
H&M - CompaniesMarketCap,.com. H&M (HM-B.ST) - Revenue
SheIn - Curry, David. SheIn Revenue and Usage Statistics (2022)
Zara - Smith, P. Inditex Group: Global Sales 2021

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Exhibit D. Consolidated Statements of Operations for Forever 21, Inc. and Subsidiaries.
Source: SEC. “UNITED STATES SECURITIES AND EXCHANGE COMMISSION -
Authentic Brands Group.”

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Exhibit E. Business Model Canvas for Forever 21

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Exhibit F. “About Us” Statement of Forever 21
Source: Forever 21. About Us.
Exhibit G. Value Chain Analysis for Forever 21

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Exhibit H. Website of Fashion Revolution, a Movement for Transparency in Fashion
Source: Fashion Revolution. Fashion Transparency Index 2022.

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