Can Party City Find a New Reason To Celebrate?

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Can Party City Find a New Reason To Celebrate?

By Thad Rueter - 07/21/2020
Can Party City Find a New Reason To Celebrate?
Flexible fulfillment could be key for retailers hoping to emerge strong from the pandemic.

The pandemic has kicked most retailers hard, and the punishment continues. But merchants keep looking for an edge, and better fulfillment and last-mile delivery services are among the most promising ways to move forward — at least, that’s what Party City hopes.

The Rockaway, New Jersey-based retail chain — which closed its stores early during the pandemic but has since reopened most of them — has signed a deal with Bringg to deploy the vendor's “out-of-the-box” fulfillment services to better serve Party City consumers and regain business. According to Tel Aviv-based Bringg, its technology enables “rapid deployment [of] new fulfillment models with shorter time to market. At the same time, the agility and modularity of Bringg's platform allows retailers to add new fulfillment and logistics models to easily adjust based on growing market trends and new business requirements.”

Fulfillment Expansion

The use of Bringg technology builds upon fulfillment efforts already undertaken by Party City during the pandemic. The retailer launched curbside pickup on March 25, for example, and on April 5 it launched store delivery services. More than 700 Party City locations now offer pickup and delivery services. The Bringg deal will help the retailer expand such services and provide “real-time” visibility into consumer order status.

The safety of our customers and employees is a top priority and partnering with Bringg allows us to provide new delivery options that ensure we do our part to promote healthy actions and positivity in this new normal,” said Julie Roehm, Party City’s chief marketing and experience officer. “By digitizing our last-mile delivery and implementing the Bringg platform into our existing logistics model, we can seamlessly provide customers with the options to buy products online and pick up in-store, pick up curbside, or have same-day delivery through one of our partners, to align with consumer expectations."

Pandemic Damage

Party City booked a 19.3% year-over-year revenue decline in the first quarter of 2019 — the latest financial figures available — with total retail sales dropping 20.3%, mainly because of store closings. Even e-commerce sales fell, by 15.4% The chain tried to hold ground via the sale of quarantine “survival kits” and “driveway drop party kits” but such items could do only so much as the pandemic and stay-at-home orders put the brakes on in-person gatherings.

Prior to the pandemic, however, Party City was striving to boost its retail power via such tactics as third-party sales on Amazon, store revamps to help with shopper navigation and to improve the overall in-store experience, separate checkouts for certain items, more personalization, inventory reductions, and closing underperforming locations.  Better fulfillment services also play a part in chain’s plans for the rest of the pandemic, and whatever commerce reality emerges from it.

Balloon Power

Take balloons — a prime Party City product — as a prime example.

Balloons are a key differentiator for Party City, with our unparalleled assortment and innovation in large part due to our unique manufacturing capability,” explained CEO Brad Weston in June while talking to financial analysts. “We have the opportunity to better leverage this advantage with the improved in-store experience as well as an improved digital experience and home delivery.”

Offering more fulfillment options also helped Party City win some business during the pandemic, well before the new Bringg deal was revealed.

Within a few weeks of closing [the chain during the early days of the pandemic], we piloted curbside pickup in a handful of stores and quickly expanded the service where we were allowed to under local regulations,” Weston said. “We saw strong buy-online-pickup-in-store growth in 2019, with sales to this channel of approximately 90%.”

That’s not the only meaningful fulfillment trend for Party City — and, no doubt, for other retailers either now or through the second half of 2020.

“With the addition of curbside pickup, we have seen buy-online-pickup-in-store penetration remains significantly higher than prior year in our reopened stores and we believe this trend will continue as customers seek more convenient options,” Weston said.

It’s a long way to whatever new normal ultimately emerges for retailers. Still, the recent experiences of Party City indicate the importance of flexibility and more services when it comes to fulfillment.