Party City and Big Lots, two well-known retailers, have announced they will close all their U.S. locations as they struggle to stay afloat financially. The announcements come after Party City’s initial bankruptcy filing earlier this year and Big Lots' recent bankruptcy filing.
According to CNN, Party City CEO Barry Litwin announced the decision to shut down stores, admitting the company’s “very best efforts have not been enough” to overcome significant financial hurdles. Since filing for bankruptcy for the first time in January 2023, which allowed Party City to eliminate nearly $1 billion of its debt, the company has continued to face challenges, including rising costs and stiff competition.
Litwin expressed his regret during a meeting with employees on December 20, 2024, stating, “It’s really important for you to know we've done everything possible... Unfortunately, it’s necessary to commence the winddown process immediately.” He also encouraged customers to enjoy one last shopping spree, highlighting the company’s longstanding presence during significant celebrations over the years.
While Party City plans to retain nearly all of its 12,000 employees during the closure process, many are reportedly facing emotional turmoil following this announcement. According to reports, as staff were informed during the meeting, they found out their benefits would cease once the wind-down process is complete.
One of the driving forces behind the decline of Party City appears to be its inability to adapt to changing consumer trends, particularly as competitors like Spirit Halloween and larger retail chains like Walmart have thrived post-pandemic. The helium shortage, which significantly disrupted Party City’s operations, also placed strain on its offerings. With rising costs, customers were increasingly reluctant to purchase the popular party supply item.
Meanwhile, Big Lots is preparing to shut down 960 locations across the United States after filing for bankruptcy and failing to complete a merger with Nexus Capital Management, which had expressed interest in acquiring the business. Big Lots President Bruce Thorn acknowledged the challenging economic climate contributing to the decision. "We remain committed to offering extreme bargains... but we have made the difficult decision to begin the (going-out-of-business) process," Thorn noted, expressing gratitude for the dedication of his associates.
Despite these challenges, Big Lots will continue to operate its stores for the time being, offering discounts of up to 50% on remaining inventory, and making temporary adjustments as they wind down operations. The stores have been known for their low-cost offerings, which attracted budget-conscious consumers but struggled to compete with bigger box retailers.
Both closures are especially poignant for local communities where businesses like Party City have been fixtures for years, such as locations serving customers for almost four decades. The Party City store at 3060 S. 31st St. and the Big Lots locations at 2603 Thornton Lane and 800 S. Fort Hood St., are situated just miles apart, and both will soon cease operations.
Interestingly, Party City’s Canadian operations, managed separately under Canadian Tire, will remain unaffected by the U.S. closures. A spokesperson confirmed, "Party City Canada remains open for business online and in-store, providing Canadians with everything they need to celebrate all their life moments." This distinction highlights the varying performances of retail stores across borders, setting the stage for potential discussions on the resilience of retail sectors amid economic strife.
The final fate of Party City and Big Lots serves as a reminder of the challenges retailers face amid shifting consumer behaviors and economic pressures. Could this be the future for other traditional retailers? The lessons learned here may echo across the industry as consumers increasingly gravitate toward innovative retail solutions, leaving behind legacy chains struggling to adapt.
