The Party’s Over: How Party City Failed

From Balloon Busts to Financial Fumbles: A Cautionary Tale for Entrepreneurs

The party’s over, folks. After 40 years of supplying the nation’s parties and events, Party City will soon be no more.

For decades, Party City was the go-to destination for balloons, costumes, decorations, and anything you needed to throw an unforgettable soiree (minus the food and booze).

Yet, despite its dominance in the party supply market, the company is shutting its doors permanently. All that will be left is the deflated balloons and confetti for the next location owners to sweep up.

Party City exited bankruptcy just a few months ago after the company struggled to pay off $1.7 billion in debt. Emerging from BK, it canceled nearly $1 billion in debt and managed to keep most of its more than 800 stores open.

In a video conference call Friday — just days before Christmas — CEO Barry Litwin told staff that the retailer will be “winding down” operations and closing all its roughly 800 stores.

Employees were also told they would not get severance and their benefits would end once the company folded.

So what went so wrong for a brand that once seemed invincible? And what can entrepreneurs learn from…