Party City, the iconic U.S. party supply retailer, is shutting down all its stores, ending nearly 40 years of business. CNN reports that the company will wind down operations immediately, marking the end of an era.

CEO’s Heartbreaking Announcement

In a video call with employees, CEO Barry Litwin shared the devastating news, telling staff that today would be their last day of work. The company, which has struggled for months, will not provide severance pay or extend employee benefits as it closes its doors.

“This is, without a doubt, the hardest message I’ve ever had to deliver,” Litwin said, expressing his sorrow over the company’s collapse. Despite Party City’s best efforts, it could not overcome its financial challenges, including soaring inflation and rising operational costs, which ultimately led to a significant decline in consumer spending.

Litwin acknowledged that Party City had fought tirelessly to avoid this outcome, but financial pressures made the winddown process inevitable.

A Long Road to Bankruptcy

The New Jersey-based company had only appointed Litwin as CEO four months ago, with his stated mission to improve Party City’s financial health. In January 2023, the company filed for bankruptcy, burdened by a staggering $1.7 billion in debt. The bankruptcy allowed it to eliminate nearly $1 billion in debt but still left the company with over $800 million to pay off, straining its finances throughout 2024.

Though Party City managed to keep most of its 800+ stores open, it closed more than 80 locations between 2022 and 2024, and its debt continued to weigh on its ability to recover.

A Sudden and Emotional End

The closure announcement shocked Party City employees, many of whom had not been informed of the company’s dire situation. Employees were sent home on December 10, and the corporate headquarters was locked down. Internal communications revealed growing confusion and frustration among staff, particularly after product development teams were abruptly recalled from a vendor trip and sent home.

Several workers expressed anger over the lack of transparency from management, especially after previous town hall meetings that projected optimism about the company’s future. Litwin later apologized for the communication breakdown, acknowledging the company’s failure to adequately inform employees about the impending closure.

Tearful Goodbyes and Hard Realities

Party City’s Chief Human Resources Officer, Karen McGowan, became emotional during the call, visibly shaken as she outlined the termination of benefits and severance for employees. “I certainly know this is a lot to take in,” McGowan said, her voice faltering as she paused to compose herself.

End of an Era for Party City

Once the largest party supply retailer in the U.S., Party City employed over 16,000 full-time and part-time workers in 2021. Known for selling balloons, Halloween costumes, and various party supplies, the company had long faced fierce competition from e-commerce giants, pop-up stores like Spirit Halloween, and large retailers such as Walmart, Amazon, and Costco.

The pandemic and a helium shortage further damaged Party City’s balloon business, adding to the financial strain. As consumer spending tightened in response to rising living costs, Party City became one of the latest casualties in a wave of retail bankruptcies.

Retail Decline Across the Nation

Party City’s closure comes as part of a broader trend of retail store closures in 2024, a year on track to see the highest number of closures since 2020. Just days ago, Big Lots announced it was also going out of business after a failed attempt to secure a rescue deal.

The growing list of retailer bankruptcies highlights the ongoing struggles faced by brick-and-mortar businesses as they navigate rising costs and shifting consumer habits.

Party City’s closure marks a major shift in the landscape of U.S. retail, signaling the end of a popular brand that had become synonymous with celebrations for decades.

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Updated: December 19, 2024 | By Megan Cerullo, Edited by Alain Sherter | CBS News

Big Lots, the well-known discount retailer, announced on Thursday that it will close all its stores nationwide as part of a bankruptcy process. The company plans to launch “going out of business” sales across its 900+ locations to liquidate inventory.

Failed Acquisition and Strategic Alternatives

Big Lots had initially planned to sell its assets to Nexus Capital Management, a private equity firm. However, that deal is no longer expected to materialize. While the company is still exploring other options and negotiating with Nexus, it has decided to move forward with closing its stores.

“We have worked tirelessly to secure a solution for the business,” said CEO Bruce Thorn. “Despite our efforts, we have made the difficult decision to begin the [going out of business] process to preserve the value of the Big Lots estate.”

A Retailer Built for Bargain Hunters

Headquartered in Columbus, Ohio, Big Lots operates more than 900 stores across the United States. Known for offering budget-friendly deals, the retailer sells a variety of products, including furniture, home décor, apparel, health and beauty items, and pantry goods. Its slogan promises “bargains to brag about.”

Bankruptcy and Store Closures

Big Lots filed for bankruptcy protection in September, originally intending to sell its operations to Nexus. Over the past year, the retailer had already announced plans to close hundreds of stores:

• August 2024: Up to 315 store closures planned.
• October 2024: Another 56 locations in 27 states marked for closure.

With the latest announcement, all remaining stores will be shuttered.

Broader Retail Trends in 2024

Big Lots is just one among many retailers struggling in a tough economic climate. According to research firm CoreSight, more than 7,100 U.S. retail locations are set to close by the end of 2024, marking a 69% increase compared to 2023. Additionally, 45 retailers have filed for bankruptcy this year, nearly double the number in 2023.

Other Major Retail Closures in 2024

CoreSight’s report highlights other companies facing significant store closures this year:

• Family Dollar: 677 locations
• CVS Health: 586 locations
• Conn’s: 553 locations
• Rue21: 543 locations
• 7-Eleven: 492 locations
• Rite Aid: 408 locations

Big Lots itself accounts for 580 closures, underscoring the deep challenges facing the retail industry.

A Glimpse at the Future

With the retail landscape shifting due to economic pressures and changing consumer behaviors, Big Lots’ closure adds to a growing list of casualties in 2024. For now, customers can take advantage of the retailer’s final sales as it exits the market entirely.

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