Party City announced on Friday that it would close all its stores, and had begun corporate layoffs that will take immediate effect.
In a meeting that was viewed by CNN, CEO Barry Litwin informed corporate employees that Party City must “start a wind-down process immediately” and that Friday would be their last work day for the company.
According to the report, Litwin stated at the meeting, “This is without a doubt the most difficult message I’ve had to deliver.”
CNN reported that the closure of the company was due to the ongoing financial difficulties at the party supplies retailer. The retailer filed for bankruptcy protection less than two years ago because it could not pay $1.7 billion worth of debt.
New Jersey’s chain emerged from bankruptcy in September 2023 with a plan that included a transition to a private company and the cancellation of nearly $1 billion worth of debt. The majority of the 800 U.S. locations were able to stay open when it emerged from bankruptcy.
According to a release, Litwin became CEO in August. He said he saw at that time “many opportunities” to improve the financial performance of the company and to create a superior end-to-end experience for customers.
Before his appointment, he served as the CEO of Global Industrial Company – a leader in industrial product distribution.
Spirit Halloween has continued to grow in popularity, both during and outside the Halloween season. In October, the holiday costume chain announced that it would be opening 10 new “Spirit Christmas”, with some stores being converted from Spirit Halloween locations.
Party City has also been under pressure from online retailers, even though the company started to sell items on Amazon.
Online retailers have also added pressure to Party City’s operation, even as the company began to offer items on Amazon
in 2018.
Party City representatives did not respond immediately to our request for comments on CNN’s story or possible store closures. The full CNN report can be read here.