Retail Minute: Party City & Bed Bath & Beyond Lessons
Hi, I’m Elizabeth Lafontaine, chief retail analyst here at Retail Leader Pro, and welcome to this week’s Retail Minute.
It seems like I say this every week, but we’ve had some major industry updates in the past few weeks that I think signal some larger themes across retail.
Party City filed for Chapter 11 bankruptcy last week in order to restructure debt. Their business model has been significantly impacted by the growth in the party supply category by mass merchants and consumer shifts in celebrations due to the pandemic and returning to the new normal. As we think about family and friend gatherings and celebrations in the future, something that was sorely missed during the pandemic, it’s interesting to me that Party City wasn’t able to meet changing consumer expectations in this new chapter. How will grocery and CPG brands look to spur new demand for occasion spending in the face of this shift?
We’ve discussed Bed Bath & Beyond a fair amount over the past month, but as we think about its potential bankruptcy, I think the challenges within the business model point to a return to normalcy after the pandemic as well. Consumers clearly have more options within the home sector, but the areas consumers invested in during the pandemic have not lasted beyond those years. Grocery and drug retailers need to look very closely at the trajectory of this retailer as they look to try and engage with consumers in a post-pandemic world where the joy of essential shopping may be dwindling as shoppers look for convenience and value.
From all of us here at Retail Leader, have a great weekend, and we will see you next week!