Iconic Tupperware Brands Seeks Chapter 11 Bankruptcy

NEW YORK — Tupperware Brands, which revolutionized food storage decades ago, has filed for Chapter 11 bankruptcy protection.

Tupperware, based in Orlando, Florida, intends to continue operations during the bankruptcy proceedings and will seek court clearance for a sale “in order to protect its iconic brand,” the firm announced shortly before midnight on Tuesday.

The corporation is seeking bankruptcy protection as it attempts to revitalize its operations. Tupperware sales increased slightly during the early stages of the COVID-19 epidemic, but overall sales have been steadily declining since 2018 owing to increased competition. Financial difficulties have continued to mount for the corporation.

Iconic Tupperware Brands Seeks Chapter 11 Bankruptcy

Doubts about Tupperware’s future have persisted for some time. Last year, the company sought extra financing as it warned investors about its capacity to continue operations and the prospect of being delisted from the New York Stock Exchange.

The NYSE issued the company an extra non-compliance warning for failing to publish its annual results with the Securities and Exchange Commission earlier this year. In recent months, Tupperware has continued to raise concerns about its capacity to stay solvent, with an August securities filing citing “significant liquidity challenges.”

Tupperware filed for bankruptcy on Tuesday, reporting more than $1.2 billion in total obligations and $679.5 million in total assets. The company’s shares have plunged 75% this year and finished Tuesday at around 50 cents each.

“The reality is that the decline at Tupperware is not new,” Neil Saunders, managing director of GlobalData, wrote in a commentary on Wednesday. “It is very difficult to see how the brand can get back to its glory days.”

Saunders explained that many consumers have been switching to cheaper home storage brands, and that competition has increased over time, particularly with the advent of online platforms like Temu and retailers like Target beefing up their own home storage and kitchenware brands.

Tupperware’s origins go back to 1946. According to the company’s website, shortly after the Great Depression, chemist Earl Tupper found inspiration while making moulds at a plastics factory, embarking on a mission to create an airtight seal for a plastic container, similar to that on a paint can, to assist families in saving money on food waste.

The brand enjoyed tremendous expansion in the mid-twentieth century, particularly with the introduction of Tupperware parties, which began in 1948. Tupperware parties, in particular, provided many women with the opportunity to run their own businesses from the comfort of their own homes, selling their products to social circles.

The approach worked so successfully that Tupperware finally pulled its products from retailers. In Tuesday’s bankruptcy statement, the firm stated that there are no immediate modifications to Tupperware’s independent sales consultant agreements.

According to court records filed Tuesday, Tupperware now employs over 5,450 people in 41 countries and works with a global sales force of over 465,000 consultants who sell products on a freelance basis in approximately 70 nations.

Tuesday’s announcement also mentioned plans to “further advance Tupperware’s transformation into a digital-first, technology-led company,” potentially indicating a shift towards increased reliance on the brand’s website or more online-focused marketing, though the company did not provide specifics.

In a statement, Tupperware President and CEO Laurie Ann Goldman recognised the company’s recent financial problems and stated that the bankruptcy process is intended to provide “essential flexibility” while it pursues this transformation. She also stated that the brand was not going anywhere.

Iconic Tupperware Brands Seeks Chapter 11 Bankruptcy

“Whether you are a dedicated member of our Tupperware team, sell, cook with, or simply love our Tupperware products, you are a part of our Tupperware family,” Goldman stated in an email. “We plan to continue serving our valued customers with the high-quality products they love and trust throughout this process.”

Goldman, who previously served as CEO of Spanx, was appointed CEO of Tupperware in October 2023, as part of a bigger leadership transition. Over the last year, the corporation has established a new management team.

SOURCE | AP