Party City and Big Lots are clearing their inventory at stores before shutting all of them in the weeks ahead.

New Jersey-based Party City is shutting down and laying off its employees just 14 months after the company exited bankruptcy under a plan that had been designed to ensure the retailer’s long-term survival.

CEO Barry Litwin told employees that the costume and party supplier couldn’t overcome pressure from low-spending consumers and high inflation. Going-out-of-business sales began Friday, he said in a video to employees seen by Bloomberg News.

“And as a result we regret to inform everyone that today will be your last day of employment,” Litwin said. “That is without question the most difficult message that I’ve ever had to deliver.”

Brick-and-mortar retailers have long struggled to remain relevant in the age of online shopping. Earlier this week, the balloons and party supplies seller was preparing to file for bankruptcy protection, Bloomberg News reported.

The company had been running low on cash and was unable to pay rent in some locations, according to a separate report.

Should the company follow through with its plan to file bankruptcy, it would be the second time in less than two years that Party City has sought court protection from creditors.

Representatives of the company didn’t return requests for comment. The company has about 700 stores, according to its website.

Big Lots sale falls through

The discount chain Big Lots is conducting going-out-of-business sales at its remaining locations after a sale of the company didn’t materialize.

The Columbus, Ohio-based retailer, which sells furniture, home decor and other items, filed for Chapter 11 bankruptcy protection in early September and said private equity firm Nexus Capital Management LP had agreed to acquire “substantially all of the company’s assets.”

But on Thursday the chain said it didn’t anticipate completing the purchase agreement. It said it continues to work toward completing an alternative transaction with Nexus or another party.

Big Lots said its goal would be to complete a sale by early January. According to the company’s website, discounts of up to 50% were being offered on the entire assortment and it announced all stores were closing.

“We all have worked extremely hard and have taken every step to complete a going concern sale,” said Bruce Thorn, Big Lots’ president and CEO, said in a statement. “While we remain hopeful that we can close an alternative going concern transaction, in order to protect the value of the Big Lots estate, we have made the difficult decision to begin the GOB process.”

Big Lots said it is continuing to serve customers in-store and online, and will provide updates as available.

Big Lots has said that high inflation and interest rates have hurt its business as consumers have pulled back on their home and seasonal product purchases, two categories the chain depends on for a significant part of its revenue. The company has also struggled with increased competition from the likes of Walmart and warehouse clubs like Walmart’s Sam’s Clubs and Costco, which have all sharpened their pricing and merchandise.

At the end of 2023, Big Lots operated nearly 1,400 stores in 48 states. A more recent store count wasn’t immediately available.

Steven Church, Michelle Fay Cortez and Anne D’Innocenzio at The Associated Press contributed to this report.