Party's over: Party City considers bankruptcy relief—again

Party City, the go-to store for party and craft supplies with 850 locations across the United States, is on the verge of filing for bankruptcy. The chain has already gone through Chapter 11 bankruptcy but is now looking at having to close a huge number of stores because they can’t afford to pay rent at some locations, the Daily Mail reported.

The store was a victim of the Covid pandemic as lockdowns and social distancing virtually eliminated parties from the schedules of most Americans. The supply chain bottleneck discouraged what clientele it had left even as rising inflation drove customers away. The company also had trouble finding helium for the balloons that are a vital part of its inventory. The situation prompted the first bankruptcy filing in January 2023 when its debt amounted to $1.8 billion.

The chain had to go through a massive overhaul as Monarch Alternative Capital and Silver Point Capital assumed control. The companies managed to pay off $1 billion of its debt. That restructuring enabled the store to keep 850 locations open.

But the economic malaise continued, and Party City had to close 60 stores. In September, those locations slated for closure began offering liquidation sales of 25 percent discounts for buyers. The Albany, GA store that recently shuttered was offering sale prices of up to 90 percent off the list price.

Party City, like so many chains that are currently closing stores, facing bankruptcy or unable to pay their bills, was a strong corporate force only five years ago. It had sales of $2.35 billion in 2019, successfully expanding before the pandemic, and had sales of $2.35 billion in 2019, the Mail noted.

Former CEO Brad Weston, who stepped down in August, has been here before and 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.”