By Daily Mail (U.S.) | Created at 2024-12-12 02:37:08 | Updated at 2024-12-22 23:05:08
1 week ago
A major party and craft retailer with 850 stores across the nation is considering filing for bankruptcy.
Party City has been faced with the possibility of mass closures just a little over a year after the company surfaced from Chapter 11 bankruptcy.
The celebration retailer, known for selling balloons and essential party supplies, is currently behind on rent at some of its locations, people close to the matter told Bloomberg.
The store's latest struggle has been brought on by its continued financial straits and lagging sales, blaming the effects of the pandemic and helium shortages, which ultimately lead the company to file for bankruptcy in January 2023 with approximately $1.8 million in debt.
Party City - based in Woodcliff Lake, New Jersey - underwent a restructuring as lenders, including Monarch Alternative Capital and Silver Point Capital took over and managed to clear around $1 billion of its debts, allowing about 850 shops to remain open.
Although some stores were saved, more than 60 had to close their doors, including five in Topeka, Kansas, Salina, New York, Joplin , Missouri and Owensboro, Kentucky, and most recently in Staten Island.
In September, Party City started liquidation sales at closing locations, offering up to 25 percent off for customers.
Party City Holdco Inc. is mulling bankruptcy just a little over a year after celebration retailer filed for Chapter 11
The Owensboro store, around 100 miles from Louisville, was reported to have closed its doors for the last time in mid-November, according to the Owensboro Times.
The Salina location, which has been in business for twenty years, is also advertising 25 percent off in its liquidation sale, but plans to remain open until January 16, local news reported.
Another Party City in Albany, Georgia recently closed with its final prices at 90 percent off, according to WALB.
The Topeka Party City store will close on January 18, 2025, and the Staten Island location in Forest Avenue Shoppers Town is set to close in mid-January, according to silive.com.
Party City was successfully expanding before the pandemic and sales of $2.35 billion in 2019, according to Forbes.
Overnight, its main customers - those hosting or attending parties - had no reason to shop at the store as social distancing was implemented.
Despite being saved from bankruptcy in 2023, the retailer closed more than 60 locations
As it emerged from the lockdowns it was plagued by supply chain issues, rampant inflation and increased competition.
At the time, the popular retailer was trading at just 40 cents on the stock exchange after once reaching nearly $23.
Former CEO Brad Weston previously said of the 2023 bankruptcy: 'Today's action to strengthen PCHI's balance sheet will bolster our ability to further advance our strategic priorities and continue to innovate and elevate the customer experience.
'As we take this important step to put our business on a stronger financial footing for the future, we are as committed as ever to inspiring joy by making it easy for our customers to create unforgettable memories.'
Weston has since stepped down as CEO of Party City, with Barry Litwin succeeding him as of August.
In September, Party City started liquidation sales at closing locations, offering up to 25 percent off for customers
In addition to being set back since the pandemic, Party City has had to compete with other well-known retailers like Walmart and Target, and the occasion-based pop-up store, Spirit Halloween.
That pressure has intensified in an era of rising prices, including for helium used in party balloons, and slowing consumer demand.
'Party City used to be one of the best games in town, but it is now something of an also-ran operation,' Neil Saunder, managing director of Global Data Retail said last year.
'There is likely still something of a role for Party City,' he continued, adding that the company should consider beefing up its online website.
