Twelve prominent businesses encountered financial collapse in the year 2024.
As inflation persisted in its relentless advance, consumers significantly reduced their non-essential spending, leading some enterprises to file for bankruptcy. Several businesses fell prey to shifting trends or even more damaging afflictions, such as cyber attacks.
At least 19 companies have eliminated a combined 14,000 jobs due to bankruptcies, according to Challenger, Gray & Christmas, a firm providing outplacement services.
Intriguingly, retail closures have surged in 20XX, as the sector's exuberant period of 2021 and 2022 — characterized by a surge in furnishings, television, and apparel purchases — has concluded. Over 7,100 stores have shut down by the end of November, as per research firm CoreSight — an increase of 69% compared to the same period in the previous year.
Filing for bankruptcy does not necessarily translate to the demise of a business. Companies often resort to Chapter 11 procedures to restructure operations, manage accumulated debt, and reduce expenses through store closures.
Here are some of the most prominent bankruptcies of 20XX, listed alphabetically:
Big Lots
Big Lots declared bankruptcy in September, following prior warnings about its potential collapse. The discount retailer revealed its deal with a private equity firm to acquire the company had failed, and it was set to close its remaining 963 locations soon.
Bowflex
Noteworthy for its late-night infomercials, the home fitness equipment manufacturer filed for bankruptcy in March. Bowflex emerged from Chapter 11 a few months later, inking a deal with a Taiwan-based company to acquire most of its assets for $37.5 million in cash.
Express
Facing continued merchandise mix missteps that failed to excite shoppers, the once-popular mall staple filed for bankruptcy in April. Nearly 100 stores closed due to these difficulties, and the company, which also owns the Bonobos brand, was sold to a consortium led by WHP Global in June.
Joann
The 81-year-old fabric and craft retailer filed for bankruptcy in March, succumbing to decreased consumer spending on items like fabric and art supplies. Joann’s stock was delisted from the Nasdaq, and the company became privately owned, reducing its debt and maintaining all 850 stores.
LL Flooring
The home retailer formerly known as Lumber Liquidators filed for bankruptcy in August, plagued by budget-conscious customers tightening their belts on costly renovations and a slowing home sales market. After initially announcing the complete closure of its 94 stores, a private equity firm bought and saved the company.
Party City
The four-decade-old retailer filed for bankruptcy in December, marking its second bankruptcy filing in less than two years. As a result, Party City plans to close its approximately 700 locations early in the new year. The New Jersey-based company faces inflationary pressures on product costs, which have reduced consumer spending, as well as $800 million in outstanding debt.
Red Lobster
The restaurant chain that brought affordable shrimp and lobster to the middle-class and grew to become the largest seafood restaurant chain in the world filed for bankruptcy in May. Years of neglect in marketing, food quality, service, and restaurant upgrades hurt the chain’s competitiveness versus fast-casual and quick-service chains. After closing more than 100 locations, Red Lobster emerged from bankruptcy in September, thanks to a new owner and leadership that is already revising the menu.
Spirit Airlines
The budget carrier landed in bankruptcy in November due to mounting losses, crippling debt, increased competition, and the inability to merge with other airlines. Spirit announced that its bankruptcy and negotiations with creditors would allow it to emerge early in the new year with less debt and increased financial flexibility.
Stoli
Stoli Group USA, the owner of the Stoli vodka brand, filed for bankruptcy in December. A series of unfortunate events — including a slowing demand for spirits, a major cyber attack that disrupted operations, and several years of legal battles with Russia — contributed to the unit’s financial decline.
TGI Fridays
The American casual dining chain famous for its “flair” filed for Chapter 11 in November following years of dealing with diminishing customer traffic and a shrinking presence. TGI Fridays stated that the fallout from the Covid-19 pandemic was the “main driver of our financial challenges” and that it would use the process to explore potential strategic alternatives to ensure the long-term viability of the brand.
True Value
The 75-year-old hardware store brand filed for bankruptcy in October, ending its legacy by selling most of its operations to a competitor. True Value reported facing significant cash constraints due to a stalling housing market and increasingly cautious consumers when it comes to discretionary purchases like hardware. True Value stores remain open because they are not part of the bankruptcy proceedings.
Tupperware
The kitchen brand synonymous with its plastic food storage containers filed for bankruptcy in September, plagued by waning popularity, ongoing financial woes, and a plethora of ownership changes. In late November, Tupperware's brand name and intellectual property were acquired by a private equity firm, aiming to revive the company's operations.
After facing decreased consumer spending and financial struggles, several businesses in the retail sector, such as Big Lots and Joann, filed for bankruptcy in 20XX. To manage their debts and restructure operations, some companies, like Red Lobster and Stoli Group USA, opted for Chapter 11 bankruptcy procedures.
