It looks like the party is over for Party City–the largest party supply store in the United States–as they announced they’ll soon be closing their doors for good.
CEO Barry Litwin told corporate employees in a meeting on Friday, December 20th that “Party City is ‘winding down’ operations immediately and that today will be their last day of employment.” Unfortunately, Party City staff was informed that they won’t be receiving any severance pay and they’ll be losing their benefits as the company goes out of business.
The decision was made based on financial challenges which, despite Party City’s very best efforts, have been impossible to overcome. Litwin stated that the company “struggled to contend with inflation, which sent the company’s costs higher and dragged down consumer spending.”
Shutting down entirely was an outcome they apparently tried their best to avoid.
.jpg){kind=link}
Some Party City store employees have already received letters stating that the company will close down stores on February 28th, at which point they will be terminated. The letter stated:
Although Party City believes these closings are in the best interest of the company, we regret that we have had to take this step and thank you for your valued contributions and service to the company.
The news doesn’t necessarily come as a surprise, as the New Jersey-based company declared bankruptcy back in January 2023 following the struggle to pay off its $1.7 billion debt load. By declaring bankruptcy the company was able to cancel nearly $1 billion in debt and, though more than 80 locations were shuttered between the end of 2022 to August 2024, most of the company’s 850+ stores remained open across more than 70 countries.
Litwin was hired as Party City’s new CEO just four months ago–in a LinkedIn post he shared that the company’s “main priority [was] to strengthen [their] financial health, and there is work ahead of [them].” The company then exited bankruptcy a month later, though it was still $800 million+ in debt.
CNN writes that the “news of the company’s impending collapse began to trickle out among the company’s corporate staff over the past couple weeks,” though employees told the outlet that they were caught off guard by the news, claiming management hadn’t mentioned any potential financial trouble and instead had expressed optimism about the company’s overall business.
Litwin apologized for this lack of communication during the meeting.