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TheStreet Open House

Sozzi: The New Look Forever 21 Should Frighten All Mall Retail Execs

NEW YORK (TheStreet) -- The rising prominence of fast fashion retailers Forever 21, H&M, and Zara is causing serious fundamental changes in the specialty retail business. Dare I say a Nordstrom (JWN) better be concerned? Gross margins are under perpetual pressure at the likes of Abercrombie & Fitch (ANF), American Eagle Outfitters (AEO), Aeropostale (ARO), and to a lesser extent, The Gap (GPS), as even on-trend styles are quick to receive a markdown to entice consumers becoming increasingly obsessed with fast fashion retailers. With gross margins experiencing so much stress, there are mass store closures well underway at malls across the United States, and reluctance by execs to invest capital in fresh store designs to position brands for the next five years.

In a move akin to stomping on the face of a fallen competitor, one fast fashion retailer, Forever 21, has begun to unveil a new look store prototype in the mall. It's snazzier on the eye. It's visually imposing from far away. It brings the feeling of a giant flagship store inside of an enclosed mall setting. The highlight of this new store you ask? The storefront windows! Other than new format American Eagle Outfitters locations, store windows have long been a problem for specialty retailers in the mall, the space is just too small to showcase mannequins (worst storefronts in the industry: Abercrombie & Fitch).

Read on for a glimpse into the new look Forever 21:

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