Forever 21 keeps expanding

The latest proposal by the L.A.-based fashion chain is to take a 40,000-square-foot slice out of the huge Sears store at South Coast Plaza. Nothing has been finalized, but Sears has filed plans with the Costa Mesa Planning Department to reconfigure some of the 274,317 square feet. Leasing from Sears may be cheaper than trying to secure separate space. From California Apparel News:

"This is a great mall for Forever 21 to be in, even if it is high-end," said Jeff Green, a retail consultant in Phoenix. "That is one of the great things about Forever 21. They can go into a moderate mall like Cerritos [the Los Cerritos Center in Cerritos, Calif.] or a high-end mall and do extremely well."

In a few weeks, Forever 21 plans to open in NY's Times Square, moving into what had been a Virgin Megastore. At the Beverly Center, it's going into the space that was home to the old Cineplex. All told, the retailer plans to have 500 stores by the end of the year. By the way, the WSJ's Japan Real Time did a profile this week of founder Don Chang (he was in Tokyo for the opening of Forever 21's fourth store in Japan).

Experts say the timing isn't bad for retailers like Forever 21, which has a "vertically integrated model," as opposed to department and general stores that need to order merchandise six months to a year ahead. Such a business model allows the company to design, cut, distribute and sell an item globally in the span of a week. Since the company controls both the production and distribution of its product, its process is quick. "Companies like Uniqlo and H&M have effectively established a new price point, expectation and shopping experience in the Japan apparel market, creating an opportunity for others like Forever 21 to take a share of a growing pie," said Brian Salsberg, a partner at McKinsey & Company in Tokyo.