Party City is closing all stores immediately and laying off staff after 38 years in business, including 25 N.J. locations

The party is over for another New Jersey-based retailer.

Party City is going out of business immediately after 38 years in business and is laying off all of its corporate staff as of Friday, Dec. 20, according to CNN.

The popular party supplies shop informed corporate employees that it is shutting down its remaining stores during a conference meeting Friday morning. During the meeting, the company also announced that its corporate employees are laid off as of today, receiving no severance pay and losing their benefits, according to the report.

From the large list of locations closing down, 25 of which are located in New Jersey.

“That is without question the most difficult message that I’ve ever had to deliver,” Party City CEO Barry Litwin said during the conference call. “It’s really important for you to know that we’ve done everything possible that we could to try to avoid this outcome. Unfortunately, it’s necessary to commence a wind down process immediately.”

Litwin explained that the company headquartered in Woodcliff Lake decided to close after failing to overcome its financial struggles and combat inflation. These issues have increased the company’s overall costs while consumer spending has fallen.

Party City originally considered filing for Chapter 11 bankruptcy in early December 2024 before ultimately shutting down, according to NJ BIZ. This would have been its second time filing since January 2023 when it attempted to restructure, cut down its $1.8 billion of debt and increase savings.

The party supplies shop tried to cut costs throughout 2023 by closing 22 underperforming stores nationwide and closing another 35 stores by mid-May. It closed over 60 locations ahead of the Friday morning announcement.

Party City was founded in East Hanover in 1986. The party supplies store operated about 850 locations across more than 70 countries.

It quickly became a go-to shopping destination for party goods and costumes, especially during the Halloween season. Its success helped the company become the largest party supplies retailer in the U.S., Canada and Mexico.