The retail sector has faced financial distress over the last year that has continued into 2025, leading to bankruptcy filings and hundreds of store closings.

Struggling retailers seeking to stay in business have closed underperforming locations, sometimes before filing for Chapter 11 reorganization. More locations are usually closed in a bankruptcy case, but if all is lost, the debtor might liquidate and shut down all operations.

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Party supply retailer Party City filed for Chapter 11 bankruptcy in U.S. Bankruptcy Court for the Southern District of Texas on Dec. 21 with plans to liquidate all of its stores.

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A day earlier, the company had informed employees that it was winding down operations and closing all stores by Feb. 28, 2025. 

Party City Holdco, which operated about 700 party supply and costume stores in the U.S., as well as stores in Mexico, and Puerto Rico, reportedly was behind on rent for some of its stores, was running out of cash, and lagging sales were making it difficult for the company to make payments on its large debt load.

Bankrupt discount home goods retailer Big Lots filed for Chapter 11 protection on Sept. 9 in the U.S. Bankruptcy Court for the District of Delaware seeking to sell its assets to stalking-horse bidder Nexus Capital Management for a $760 million bid, but the deal fell through in December.

The debtor on Dec. 19 said it would shut down all 1,392 stores, but eight days later agreed to a sale transaction with Gordon Brothers Retail Partners that allows for the transfer of stores, distribution centers, and intellectual property to other retailers and companies.

Under Gordon Brothers’ plan, Variety Wholesalers Inc. will purchase 200 to 400 Big Lots stores and operate them under the Big Lots brand, along with up to two distribution centers.

Beyond buying Buy Buy Baby

Another retailer also will be revived by way of a sale. Retail brand owner Beyond (BYON), which owns Bed Bath Beyond, Overstock, and Zulily, has reached an agreement with BBBY Acquisition Co. to purchase the global rights to the formerly bankrupt Buy Buy Baby for $5 million, the company said in a Feb. 3 statement.

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If the transaction closes, it will reunite Buy Buy Baby with its former corporate parent Bed Bath Beyond in another company. The two retailers were previously sold at bankruptcy auctions following a Chapter 11 filing on April 23, 2023.

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The assets acquired by Beyond would include databases, domains, intellectual property, vendor relationships, and content related to Buy Buy Baby.

“Bed Bath & Beyond and Buy Buy Baby have historically been synonymous with supporting families, their homes, and all of life’s milestones,” Beyond Executive Chairman Marcus Lemonis.

“Our goal is to go beyond the traditional omnichannel mindset, focusing on the four corners of the property, and the four walls of the home,” Lemonis said. “It is our objective to help homeowners enhance, protect, and unlock the value of their most important assets and information related to their homes and lives.”

Buy Buy Baby might team with Bed Bath and Beyond

Beyond, which is an e-commerce-focused affinity company that owns or has ownership interests in various retail brands, said it will consider both online and brick-and-mortar retail opportunities for Buy Buy Baby, which could include integrating Buy Buy Baby into Bed Bath and Beyond stores to opening standalone locations under each banner.

When Bed Bath & Beyond owned BuyBuy Baby before its 2023 bankruptcy filing, it operated about 120 baby product stores. 

Buy Buy Baby shut down all of its stores in October 2023 after Dream On Me in July 2023 bought the brand and digital assets in a bankruptcy auction for $15.5 million, 11 store leases for $1.7 million, and then reopened for business.

BuyBuy Baby was founded in 1996 by Richard and Jerry Feinstein, sons of Bed Bath & Beyond founder Leonard Feinstein. In 2007, Bed Bath & Beyond purchased the baby products retailer for $67 million.

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