Tupperware Brands, the American company sspecialized in food containers, has started a bankruptcy protection proceedings according to Chapter 11. This section of the United States Bankruptcy Code allows struggling businesses to restructure debts and continue to operate, avoiding immediate pressure from creditors.
Tupperware's decision comes after the failure to meet a crucial debt deadline and marks a critical point for the company, which has long been facing a growing economic crisis.
The Roots of the Tupperware Crisis
The company, founded in 1946 by chemist Earl Tupper, experienced exponential growth thanks to its innovative airtight plastic containers and its famous door-to-door sales model. The global economic crisis, the increase in raw material, labor and transportation costs, and competition from e-commerce have eroded the company's profit margins.
Since 2021, Tupperware has recorded a continuous decline in sales for six consecutive quarters, culminating with a revenue of only $1,3 billion in 2022, a 42% reduction compared to five years earlier. The financial difficulties are further amplified by thehigh debt: The company's assets are estimated between $500 million and $50.000 billion, while its liabilities range between $100.000 billion and $XNUMX billion. Tupperware also has between XNUMX and XNUMX creditors.
Rescue attempts
In 2023, the company had already initiated a debt restructuring in collaboration with its financiers and had instructed the investment bank Moelis & Co to explore strategic alternatives. The relaunch attempts, however, were not sufficient to stabilize the company's financial situation.
Laurie Ann Goldman, CEO of Tupperware, said that the decision to opt for Chapter 11 was motivated by the need to gain flexibility in the digital and technological transformation of the company. "We evaluated several strategic options and decided that filing for bankruptcy protection was the best solution," Goldman explained, "now we are focused on transforming into a digital and technologically advanced company," stressing that this process should allow Tupperware to restructure and adapt to an increasingly challenging economic environment.
Despite the bankruptcy proceedings, Tupperware has declared theintention to continue operating during the restructuring, ensuring that employees and suppliers will be paid regularly. The situation remains precarious, with the Company's stock suspended on Wall Street yesterday and the uncertainty surrounding the brand's future.
The company, which had shown signs of recovery during the pandemic thanks to restaurant closures and lockdowns, has now faced a new post-pandemic crisis which has severely tested its ability to adapt and resilience. Tupperware's bet is now on its ability to use Chapter 11 to reinvent themselves and regain ground in a rapidly changing market.
The end of an American symbol?
Tupperware has become aAmerican icon thanks to its innovative design of airtight containers and the sales model known as Tupperware Party. This approach has revolutionized the way we store food and has been an emblem of American entrepreneurial initiative. Over the years, Tupperware has been a symbol of American creativity and ingenuity, with over three million global “ambassadors” in 2017. Today, however, the company faces the challenge of demonstrate your resilience and the ability to be reborn despite unprecedented difficulties.
