There will be job losses, but industry insiders are largely optimistic many shopping centres will be able to manage as Forever 21 files for bankruptcy in the U.S., and closes its Canadian stores.
The once-hot destination for young shoppers will close 44 stores across Canada, and up to 178 locations in the United States.
Depending on the mall, the store’s departure could be an inconvenience, or a real problem, according to retail expert David Ian Gray with DIG 360.
“Where we see challenges are when you get secondary malls that maybe need a refresh, there’s a little bit less demand for them now than there was about 10 years ago.”
With Forever 21 stores across Canada preparing to shut up shop, what does that mean for your local mall? And are there other retailers willing to fill that space? Listen to @NEWS1130 as we explore those questions with industry insiders.
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He says malls with a lot of foot traffic should be able to manage the closures.
“Metrotown is one of the top producers in Canada. Guilford is really strong as well. Richmond Centre may have a little trouble, but I don’t really believe so. I think those malls are going to be okay,” he says.
“And when you read a lot of the news about struggling suburban malls, I have to say it’s much more a U.S. story than Canadian story.”
Craig Patterson with Retail Insider has a similar view of the situation, and points to the health of the Lower Mainland retail market.
“Say, you know, Tsawwassen Mills — a terrific shopping centre, but hasn’t had the same kind of foot traffic. That might be a challenge to fill.”
But as for the timing, Patterson says other stores are fearing cut-price clearance sales at Forever 21, right as the all-important holiday shopping season begins.
“The lessons to take away is: have something that people want to buy, and create an experience and a reason for them to come into the store. And unfortunately, I don’t think Forever 21 did that.”
Around 2,000 people work at Forever 21 stores in Alberta, B.C., Manitoba, Ontario, Quebec and Nova Scotia. These locations will stay during the liquidation process.