Tupperware, manufacturer of many households’ favorite storage containers, is in deep financial trouble and after 77 years may have to close its doors if it does not quickly obtain additional financing.
The US company says there is “substantial doubt about its ability to continue” after its shares tumbled nearly 50% on Monday. The shares recovered a meager 5.6% on Tuesday.
Tupperware is also in danger of being delisted from the New York Stock Exchange because it has not yet submitted its annual report. Meanwhile, the company is being forced to renegotiate its loans after having amended its loan agreements three times since August last year.
Tupperware says it is struggling with higher interest costs on its loans as it tries to turn the business around.
The Tupperware brand gained notoriety – and popularity – in the 1950s and 1960s when people around the world held Tupper parties at their homes selling the plastic containers.
Decades later, Tupperware still has direct sales power, which means it earns a percentage of every Tupper product sold. However, the sales force shrank by 18% in 2022 compared to the previous year.
The company, which was also hit hard during the Covid-19 pandemic, has now forcibly started selling its products in the American retail chain Target in an attempt to attract younger buyers as well as other retailers worldwide.
Tupperware has also already expanded its range to cooking products, which includes a grill that can be used in a microwave.
Neil Saunders, managing director of retail at the consulting company GlobalData, says that if the company had started with innovation ten years ago, Tupperware’s fate might have looked different today.
However, he doubts whether there is anything the company can still do to help him out of the financial predicament.
“Tupperware has failed to change with the times in terms of its products and distribution,” says Saunders.
Saunders says that selling Tupperware products to younger customers – through Tupper parties, for example – simply doesn’t work in today’s times. Moreover, the company’s older customers have already moved on to cheaper and more fashionable containers that are available in stores or online.
Tupperware warns “that it may not have sufficient liquidity in the near future”.
The struggling company is now working with financial advisers in an attempt to secure more money and investment. The possibility is also being explored whether the company could sell some of its property and cut jobs to keep the doors open.
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