Authentic Brands Group: Swipe Left Forever 21… Forever?

Tulsi Jayakumar, Sanskriti Sriram, Mallika Tripathi, Rishab Sud

Product #:W47346

Supplier:Ivey

Discipline:General Management, Strategy

Setting:India, 2025

Details:Case (PDF) • 15 pages • 2026-02-06

Subjects:

Turnarounds

Industries:

Goods, trade, and consumer services

Your Price:

$9.71

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In March 2025, Jamie Salter, founder and chief executive officer of Authentic Brands Group (ABG), faced a pivotal challenge. Forever 21’s US operating company, F21 OpCo LLC, had filed for its second bankruptcy in six years, closing all physical stores in its home market. While Forever 21’s intellectual property remained with ABG and international franchises continued to operate, the brand’s US collapse underscored risks of overexpansion, weak digital capabilities, and fast fashion’s reputational baggage. ABG had thrived on an asset-light licensing model. With Forever 21 still retaining value internationally, Salter faced four strategic options: auction a new US licence, pursue a digital-first revival, double down internationally, or exit the brand.

Learning Objectives

This case is suitable for master of business of administration (MBA) and executive MBA courses in strategy, business models, turnaround and restructuring, and retail brand management. At the undergraduate level, it can be used in courses on strategic management. The case fits best in the mid- to late stages of a strategy module, after the introduction of business models and before advanced topics such as corporate portfolio strategy. It is also appropriate for modules on family business and entrepreneurship, as it highlights the governance failures at Forever 21 under its founding family. After working through the case and assignment questions, students will be able to do the following:

Assess Forever 21’s failure within the fast-fashion industry and identify structural challenges in the sector.
Evaluate ABG’s asset-light licensing business model for its advantages and risks and its strategic fit with different brand categories (e.g., fashion retail vs. media).
Analyze the trade-offs among strategic options facing ABG: licensing, digital transformation, international expansion, and divestment.
Critically evaluate issues of brand stewardship, sustainability, and reputational alignment in managing distressed consumer brands.
Distinguish between value creation and value capture in asset-light models and apply transaction cost economics to analyze when licensing is an effective governance choice.