Party City

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Party City Holdco Inc.
Public
Traded as NYSEPRTY
Russell 2000 Component
ISIN US7021491052
Industry Retail
Founded 1986; 32 years ago (1986)
East Hanover, New Jersey, U.S.
Founder Charlotte bini
Headquarters Rockaway, New Jersey, U.S.
Number of locations
900+[1] (2015)
Area served
Worldwide
Key people
Gerald C. Rittenberg, Executive chairman
James M. Harrison, CEO
Michael A. Correale, CFO
Products Party supplies, Halloween costumes
Revenue Increase$2.27 billion[1] (2014)
Increase$81.3 million[1] (2014)
Increase$56.1 million[1] (2014)
Total assets Increase$3.38 billion[1] (2014)
Total equity Increase$487 million[1] (2014)
Number of employees
10,000+
Parent Amscan Inc.[2]
Divisions Party City Canada
Halloween City
Toy City
Website www.partycity.com
www.partycity.ca
www.partycity.com.mx

Party City is an American publicly traded retail chain of party supply stores founded in 1986 by Steve Mandell in East Hanover, New Jersey. Based in Elmsford, New York, the company is the largest retailer of party goods in the United States, Canada and Mexico, operating over 900 company-owned and franchise outlets under the Party City, Halloween City, Toy City, and Factory Card & Party Outlet brands.[3]

History[edit]

Facade of a Party City store in The Woodlands, Texas

Party City was founded by Steve Mandell in 1986, Mandell recognized that the market for party goods was highly fragmented with a lot of small mom-and-pop operations, a large number of retailers carrying limited supplies, and no big players dominating the market. Mandell decided to specialize in the business when he struck out on his own to realize his long-cherished goal of running his own retail operation. After scraping together $125,000, he opened a 4,000 square feet (370 m2) store in East Hanover, New Jersey, naming it Party City. The operation was immediately successful and within a year Mandell started planning for a second location. He also began to hear from people asking to franchise the Party City concept, and as a result Party City began its evolution into a national chain. After his first year in business Mandell also decided to concentrate on Halloween, so that in 1987 over a quarter of his store was turned into a "Halloween Costume Warehouse." The move proved highly successful and led to the company's ongoing focus on the holiday, and the major impact that the month of October would have on the company's bottom line. Year-round, Party City stocked an inventory of Halloween costumes, if for no other reason than to make customers aware of the items for the next Halloween season.[4]

The first Party City franchise store opened in 1989 in Hazlet, NJ[5] and by 1990 Mandell also owned four Party City stores. At this point he incorporated the business as a franchising operation, with his stores forming the core of the chain. By the end of 1990, Party City outlets numbered 11; five more franchised stores were added in 1991, 16 in 1992, and another 26 in 1993, bringing the total to 58. Party City was now a nationwide chain with store locations ranging from Hawaii to Puerto Rico. The company's annual revenues in 1993 topped $2.4 million and net profits approached $235,000. During these first four years of operation, Mandell refined the Party City concept, including store design, product mix, choice of suppliers, and the implementation of systems. With a successful store model in hand, Mandell in late 1993 decided to de-emphasize franchising in favor of opening company-owned stores, which would generate greater returns for the corporation than it could receive on fees and royalties from franchised outlets, as well as allow Mandell to better control the destiny of Party City. While franchisees might maintain a tighter control on inventory, Mandell was insistent that company-owned units would be amply stocked with a wide range of merchandise.[4][5]

Halloween Costumes[edit]

Party City sells controversial costumes stereotyping Native Americans. In a tweet on September 30, 2018, a Party City representative stated that “Party City has costumes for all types of Halloween customers, and nothing we carry is meant to be offensive.” [6]

Toy Sales[edit]

In June 2018, Party City announced that it would open around 50 Toy City pop-up stores beginning in September 2018, alongside its seasonal Halloween City stores. The stores will operate through the conclusion of the holiday season. The decision was meant to capitalize upon the closure of the U.S. locations of Toys "R" Us.[7][8]

Acquisitions[edit]

In 2005, the company was sold to Amscan Holdings, Inc., the largest designer, manufacturer and distributor of party goods in America.[9] Amscan then went on to acquire the party retailers Party America in 2006 and Factory Card & Party Outlet in 2007. Both retail chains began to operate under the Party City network, thereby making Party City the largest party supplies retailer in the United States.[10]

With Amscan’s 2011 acquisition of American Greetings’ Designware party division, Party City added licensing agreements with Nickelodeon, Sesame Workshop, and Hasbro.[11] In 2011, Amscan became a licensee for MLB, NBA, NFL, NHL and NCAA party products and balloons, and Party City carries all teams in their respective markets and offers the entire assortment in larger stores and online.[12]

In 2009, Party City launched an e-commerce website at PartyCity.com and in 2011 added a “Party Ideas” Center containing shopping checklists, photo galleries and video tutorials.[13]

In 2011, Party City expanded outside the United States with the acquisition of the Canadian retailer Party Packagers, making Party City the largest party goods retailer in North America. In 2012, these stores began to re-brand as Party City. In 2013 Party City bought iParty, a now defunct discount party super store that had locations in both New England and the Tampa Bay Florida area.

References[edit]

  1. ^ a b c d e f "FORM S-1/A (Securities Registration Statement)" (PDF). Party City Investor Relations. Party City Holdco Inc. 10 April 2015. pp. 19–20. Retrieved 17 April 2015.
  2. ^ "Company Overview". Amscan, Inc. Retrieved 17 April 2015.
  3. ^ "PARTY CITY ANNOUNCES PRICING OF ITS INITIAL PUBLIC OFFERING". Party City. Party City Holdco Inc. 15 April 2015. Retrieved 17 April 2015.
  4. ^ a b "Party City Corporation History". Funding Universe. Retrieved 17 April 2015.
  5. ^ a b "Party City Holdings Inc. Press Kit" (PDF). Party City. January 2015. Retrieved 17 April 2015.
  6. ^ "Party City on Twitter". Twitter. Retrieved 2018-10-01.
  7. ^ "Party City joins the list of retailers feasting on Toys 'R' Us remains". Fortune. Retrieved 2018-07-13.
  8. ^ Thomas, Lauren (25 June 2018). "Party City to open Toy City stores in wake of Toys R Us' demise". Retrieved 26 June 2018.
  9. ^ "Acquisition of Party City Corporation by AAH Holdings Completed". Press Releases. Amscan Holdings. Retrieved 17 April 2015.
  10. ^ "Party America, a Leading Party Goods Retailer, Acquired by AAH Holdings Corporation". Press Releases. Amscan Holdings. Retrieved 17 April 2015.
  11. ^ "Amscan Announces Strategic Alliance With American Greetings". Press Releases. Amscan Holdings. Retrieved 17 April 2015.
  12. ^ Lefton, Terry (3 June 2012). "Party time". Street & Smith's Sports Business Journal. American City Business Journals. Retrieved 17 April 2015.
  13. ^ "Party City Livens Up Cyberspace With New Online Store". PR Newswire. 24 August 2011. Retrieved 17 April 2015.

External links[edit]