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Party City files for bankruptcy, a day after announcing mass layoffs
The popular retail chain Party City has filed for Chapter 11 bankruptcy protection, just one day after informing employees of massive layoffs at its headquarters in New Jersey. According to court documents obtained by CBS News, the company has liabilities ranging from $1 billion to $10 billion.
In an email sent to employees on Friday, Chief Human Resources Officer Karen McGowan announced that the company would be conducting immediate “mass layoffs” at its Woodcliff Lake, New Jersey headquarters. The move marks a significant shift for the company, which was founded in the mid-1980s and has over 700 company-owned and franchise store locations across North America.
The filing comes as no surprise to many experts, given the current retail landscape. In fact, more than 7,100 stores have closed through the end of November this year alone, a staggering 69% increase from the same period last year, according to data from research firm CoreSight.
It remains unclear whether Party City’s e-commerce operation will continue in light of these developments. The company did not respond to a request for comment when reached by CBS News New York on Friday.
As part of its bankruptcy filing, it is likely that the company will attempt to restructure its debt and potentially renegotiate contracts with suppliers and other business partners. This process can be lengthy and complex, but could ultimately provide a path forward for the company.
The mass layoffs announced yesterday are just the latest in a string of difficult decisions for Party City’s management team as it navigates these challenging times.
Source: www.cbsnews.com
