Forever 21 will close all of its Riley Rose beauty locations, Women’s Wear Daily reports. Brands have been notified of the plans, according to the report. Forever 21 referred Retail Dive to the court docket concerning its bankruptcy filed in September.
The retailer said in court filings that it will shutter as many as 178 U.S. stores as part of its bankruptcy restructuring. A location at Penn Station in New York City, opened only in July, is one Riley Rose store slated for closure, among 21 listed on a document filed Oct. 10. In documents filed Wednesday and Tuesday, the company has designated another 111 stores to close, for a total of 132 so far; among them are at least two other Riley Rose stores, in Tukwila, Washington, and Wauwatosa, Wisconsin.
A notice on what was once the Riley Rose standalone website alerts customers that as of Oct. 28 it’s now a tab on the Forever 21 site. That tab still maps 15 Riley Rose stores in 11 states. The company opened its first Riley Rose locations two years ago.
As Forever 21 contemplates how to right-size what by its own admission is an over-extended footprint, its standalone beauty banner is a logical point of focus, in light of sagging sales in the market.
The category has been a winner for the last four or five years, but, at least in North America, is cooling, in favor of a more natural look and an emphasis on healthy skincare, according to L'Oreal CEO Jean-Paul Agon. He told analysts in July that makeup sales are now "flat in the U.S. at best," according to a transcript from Seeking Alpha. Ulta CEO Mary Dillon in August similarly noted a slowdown in cosmetics as that beauty retailer uncharacteristically lowered its guidance for the year.
Agon also said that Amazon's success in the category is a boon to the company's brands, which are sold there —but that's not an option for Forever 21. And it's not just Amazon. While Forever 21's Riley Rose arguably has an edge by emphasizing popular "K-beauty" items from South Korea, it is also up against the likes of Ulta, which has tied up with makeup influencers like Kim Kardashian West and Kylie Jenner, and Sephora. Both have many more locations, stronger digital operations and longer histories, and neither is in such dire financial straits.
Finally, mass merchants and drugstores like Target, and even the department stores that have been ceding share, have stepped up in the category, fueling competition.