Party City, the renowned retailer of party supplies, has announced it will shut all its stores, marking the end of nearly 40 years in business.
The abrupt decision has left thousands of employees without severance pay or continued benefits, igniting widespread criticism and outrage.
Immediate Closure Leaves Staff in Shock
Barry Litwin, Chief Executive of Party City, informed employees via video conference on Friday that the company was 'winding down' operations with immediate effect. Workers were told December 20 would be their last day of employment, with no severance packages or extended benefits provided, according to CNN.
'This is without question the most difficult message I've ever had to deliver,' Litwin said during the call. 'It's really important for you to know that we've done everything possible to try to avoid this outcome. Unfortunately, it's necessary to commence a wind down process immediately.'
Financial Collapse Years in the Making
Party City had been grappling with significant financial challenges for years, amassing a staggering debt of £1.34 billion ($1.7 billion). In January 2023, the company filed for Chapter 11 bankruptcy protection to restructure its debt, cancelling nearly £788 million ($1 billion) in liabilities. However, the company still struggled under the weight of £630 million ($800 million) in remaining debt.
Rising costs during the pandemic, a helium shortage that crippled its balloon business, and fierce competition from online retailers like Amazon and Walmart all contributed to Party City's decline. Despite efforts to save the business, including the closure of more than 80 stores between 2022 and 2024, these measures were insufficient to stave off bankruptcy.
According to NBC Chicago, the company announced in December that it was unable to meet its financial obligations, forcing it to shut down all remaining locations.
An Emotional Farewell to a Retail Icon
Party City's closure signifies the end of an era for a company that once operated over 800 stores nationwide and employed approximately 16,500 people. The retailer was a go-to destination for balloons, party supplies, and Halloween costumes.
Its demise reflects the increasing pressures on traditional brick-and-mortar stores in a market increasingly dominated by online retailers and shifting consumer habits.
While some stores will remain open until February 2025, employees have expressed frustration over the lack of communication from management. Corporate staff were abruptly sent home on December 10, and access to office buildings was restricted.
Despite the sudden closure, Party City's website remains operational, allowing customers to make final purchases. However, for the company's employees, the abrupt shutdown has left a bitter legacy of broken promises and financial uncertainty.
