Forever 21 Taps H&M’s Daniel Kulle to Take Over as CEO
Kulle’s arrival signals a shift for the firm, which was tightly controlled by its founders until last year’s bankruptcy filing.
(Bloomberg) -- The new owners of Forever 21 Inc. have hired an executive from another fast-fashion chain to steer the troubled retailer outside of bankruptcy.
Daniel Kulle, who worked at Hennes & Mauritz AB for more than two decades, will take over as Forever 21’s chief executive officer, Authentic Brands Group Inc. said in a statement Tuesday. Authentic Brands is part of a group that bought Forever 21. Kulle recently served as H&M’s North America president for nine years.
His arrival signals a shift for Forever 21, which was tightly controlled by its founders until last year’s bankruptcy filing. Authentic Brands said he will focus on improving e-commerce and making the company more environmentally friendly -- an important issue for the chain’s client base. He will also oversee new in-store events and expand Forever 21’s loyalty program and stable of partner brands.
These goals may prove challenging as the retailer seeks to rebuild its business following bankruptcy.
“We have to get everything going again because there’s been some bumps in the road,” Kulle said in an interview. “We have to get everything up to speed again.”
‘Direct Match’
Forever 21 filed for Chapter 11 in late September. The founders struggled to retain control before and during the process, which spooked some potential lenders and buyers. Much of Forever 21’s distress was due to its large and expensive stores, poor inventory management and losses in some international markets.
Jamie Salter, CEO of Authentic Brands and a longtime friend of Kulle, said the former H&M executive was the right person for this turnaround job.
“His ideas were a direct match to what we were thinking on how to make this an exciting retailer and experience,” Salter said in an interview.
Kulle oversaw the opening of 600 new stores and a quadrupling of North American sales to $4 billion during his tenure at H&M, according to the statement from Authentic Brands. He also advised the H&M CEO on sustainability issues.
Building Experiences
The fast-fashion retailer, which historically had very few in-store events, wants to create new experiences to draw in shoppers. For now, consumers can expect more Instagram, Facebook and short-form content.
“Don’t be surprised if Forever 21 is in the entertainment business,” Salter said.
Forever 21’s core shoppers -- teens and college students -- have increasingly migrated to apparel chains that promote sustainability, such as resale and rental subscriptions. They’re willing to dole out more money for clothes with a lower environmental impact, according to a study by First Insight Inc. released in January.
Kulle said sustainable fashion is the future, and this will be reflected in Forever 21’s supply chain. The company will also reconsider its vendors. Those that don’t comply with new standards will be given a chance to make changes.
“It’s going to be a lot of work, a lot of things need to be done, but we have the ambition to go toward a much more purpose-driven company,” Kulle said.
The merchandise team, which for most of the company’s history was controlled by its founders, will undergo an overhaul as well.
--With assistance from Sally Bakewell.
To contact the reporters on this story: Lauren Coleman-Lochner in New York at llochner@bloomberg.net;Jordyn Holman in New York at jholman19@bloomberg.net
To contact the editors responsible for this story: Rick Green at rgreen18@bloomberg.net, Jonathan Roeder, Nicole Bullock
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