The iconic food storage container company has experienced declining sales in recent years, leading to financial difficulties.
Why did Tupperware file for bankruptcy?
Tupperware, once synonymous with its airtight plastic containers, has struggled to maintain its popularity among consumers in recent years.An attempt to boost distribution through a partnership with big-box chain Target failed to improve the company’s fortunes, according to an AFP report.
The company’s history dates back to 1946 when chemist Earl Tupper “had a spark of inspiration while creating molds at a plastics factory shortly after the Great Depression,” according to Tupperware’s website.
“If he could design an airtight seal for plastic storage containers, like those on a paint can, he could help war-weary families save money on costly food waste.” Over time, Tupper’s hermetically sealed plastic containers became associated with “Tupperware Parties,” where friends would gather with food and drink as a company representative demonstrated the items.
In 2022, the New York-listed company issued a warning about its ability to continue operating due to its precarious financial situation.
Laurie Ann Goldman, the company’s president and CEO, attributed Tupperware’s financial struggles to the “challenging macroeconomic environment” over the past few years.
Goldman said, “As a result, we explored numerous strategic options and determined this is the best path forward.”
Tupperware plans to seek court approval for a sale process to safeguard its brand and further its transformation into a “digital-first, technology-led company.”
The Orlando, Florida-based company also intends to request approval to maintain operations during the bankruptcy proceedings, ensuring that employees and suppliers continue to be paid.
Goldman reassured customers, saying, “We plan to continue serving our valued customers with the high-quality products they love and trust throughout this process.”
The company’s shares have experienced a significant decline, trading at $0.5099 on Monday, a sharp drop from $2.55 in December 2022.
Tupperware has implemented a strategic plan to modernize its operations and drive efficiencies to stimulate growth, following the appointment of a new management team last year.
The statement said, “The Company has made significant progress and intends to continue this important transformation work.”
In its filing with the US Bankruptcy Court for the District of Delaware, Tupperware reported assets ranging from $500 million to $1 billion and liabilities between $1 billion and $10 billion. The filing also revealed that the company has between 50,000 and 100,000 creditors.
