Escrito por: Sierra Porter | Redactora
This year has been extremely hard on businesses; the large corporate businesses we are used to seeing on every street corner have not been exempt. The pandemic and quarantine inflicted lasting effects on these businesses, and the debt that racked up is too much to handle. High costs and growing debt are not the only setbacks these businesses are facing; competition with online retailers is taking them out completely. Some of these well-known businesses have been in the game for over 50 years, and by the end of 2024, they may be gone completely.
Rite Aid — After almost 60 years, Rite Aid is losing its battle of fighting a long chain of problems including lawsuits and debt from COVID-19. Similar to other pharmacies like CVS and Walgreens, Rite Aid faced several lawsuits of filling unlawful opioid prescriptions for customers — adding to the tremendous debt they were already facing. Competition from other pharmacy chains like Amazon, Costco, Walmart and Target was also another huge setback. From March to May of 2023 alone, the company losses added up to $307 million — creating an ultimate 3.5 billion dollar debt. Rite Aid has now filed for Chapter 11 bankruptcy — a form of bankruptcy that allows a company to stay in business in an attempt to restructure obligations — and many of its stores have been shut down.
Bed Bath & Beyond — Bed Bath & Beyond is known for having designer furniture, home goods and good quality houseware — now they are known for accounting for one of the largest retail bankruptcies in years. The company attempted to avoid bankruptcy by shrinking its businesses and also not giving severance to the laid-off employees of such businesses. To no avail, they were forced to file for bankruptcy and shut down almost 500 stores, including their secondary stores like Buy Buy BABYs. Fortunately for Bed Bath & Beyond, their bankruptcy was bought out by Overstock.com and is now a fully online retail store.
Party City -– The party is over at Party City as they’ve been forced to file for Chapter 11 bankruptcy to eliminate their 1.7 billion dollar debt. Party City has struggled to stay afloat as they are being weighed down by their competitors. Stores like Walmart and Target have all the party supplies people need and more, so there was almost no purpose for Party City. A bankruptcy agreement will have 800 Party City stores closed but a billion dollars will be eliminated from their debt for the purpose of restructuring. There may be hope for Party City.
SmileDirectClub -– SmileDirectClub was a teledentistry company that offered more affordable and physically appealing alternatives to expensive braces. They sold teeth aligners with the goal, “to continue to provide affordable and accessible oral care to its customers without disruption.” In its short run of less than 10 years, the company racked up an impressive $900 million in debt, along with a bad reputation from other medical groups, the business never financially recovered. After only three months of filing for Chapter 11, SmileDirect went fully bankrupt and shut down for good.
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