Tupperware Brands, the food-storage company known for its resealable plastic containers and pioneering direct-to-consumer sales, has filed for bankruptcy after years of struggling with weak sales.
Tupperwareās voluntary chapter 11 filing gives it, and certain subsidiaries, the chance to sell to lenders or an outside buyer to preserve the more than 75-year-old brand. For decades, Tupperware has been a household name, not just for its containers but also for its direct-sales marketing to homes, with an army of independent dealers showing off products at so-called āTupperware parties.ā
Tupperwareās path to survival now runs through bankruptcy courtāand isnāt altogether clear. It filed for chapter 11 while at odds with some of its lenders, which have pushed to acquire its brand name and other assets through a foreclosure outside of chapter 11, court papers show.
Now that it has filed for bankruptcy protection, Tupperware wants to use its $7.4 million in cash on hand to fund a 30-day bidding process. After marketing itself for 17 months, the company believes it can wrap up the process in a cash-only auction.
Lenders including Stonehill Capital Management, Alden Global Capital and a Bank of America trading desk recently acquired the companyās $800 million in outstanding loans for between three and six cents on the dollar, Chief Restructuring Officer Brian Fox said in a sworn declaration.
Tupperware was founded in 1946 by Earl Tupper, a chemist who designed airtight plastic containers to help families save money by keeping food fresh for longer in the postwar era.
The company made its debut with 13 leakproof products, including the Wonder Bowl, which is still sold today. Tupperware products were originally sold at hardware and department stores across the country, but that changed in 1947 when Brownie Wise, a single mother living in Detroit, discovered Tupperware at a local hardware retailer.
Wise was working for a company that had recently launched an at-home sales demonstration business model. She saw the potential in Tupperware and, inspired by this business model, came up with one of her own: Polly-T parties. Now called Tupperware parties, these events would have a host partner with a well-dressed Tupperware dealer to sell the products to friends and family.
Wise would fill the Wonder Bowl with water or grape juice, seal the lid, then toss it to an attendee, delighting them when the bowl didnāt shatter or spill when dropped. Party sales began to outpace retailers, and Tupper took note.
Brownie Wise tosses a bowl filled with water at a Tupperware Party in the 1950s. - APIC/Bridgeman/Getty Images
In 1951, he pulled Tupperware from traditional stores, pivoting to the consultant-based model that the company uses today. He also hired Wise as head of marketing and a vice president at the company.
The timing was right for Wiseās approach: Women who had worked through World War II were now back in the home and looking for more to do with their time. Consumer demand for Tupperware was high, making parties an easy sell for women who wanted to earn supplemental income. She became the first woman featured on the cover of Businessweek three years after she became Tupperwareās head of marketing.
The same drivers of Tupperwareās success paved the way to financial distress in recent years. Plastic has fallen out of favor among consumers who are worried about the environmental impact of the material. Meanwhile, consumer habits have changed, as people are buying homewares either in stores or online. Tupperware described itself as ālate to the partyā in its bankruptcy filing, noting that only 13% of its products are available on its website.
Tupperware has expanded its operations by selling products in Target stores and on Amazon, to mixed success. While Amazon customers search for Tupperware more than 500,000 times monthly, they are directed to other brands.
The companyās independent sales force, meanwhile, has been plagued by departures, who found that Tupperware products werenāt consistently available for them to sell.
āOver the last several years, the companyās financial position has been severely impacted by the challenging macroeconomic environment,ā Chief Executive Laurie Ann Goldman said. Its shares have lost about 75% year to date.
In 2020, the company hired former Avon executive Miguel Fernandez as its CEO and president to address its pressing financial needs. He oversaw the companyās first attempted sale process in April 2023, which ultimately fell apart when the company was unable to attract strong enough bids to appease its lenders.
In August 2023, the company restructured its debt, installed a restructuring committee and hired turnaround professionals. Two months later, Tupperware tapped its current CEO, Goldman, to replace Fernandez.
In March, Tupperware delayed filing its 2023 annual earnings report due to a shortage of accountants and internal control issues. In June, the company said it was going to close its only factory in the U.S. and lay off nearly 150 employees.
While this was going on, Tupperware began its second sale process, which nearly closed in July. The company said the deal fell apart on the eve of its execution.
Tupperware wanted to continue to market itself, but could only do so if it extended its forbearance agreement, which required that it lift restrictions on lenders to sell the companyās debt. Those lenders unloaded their positions to Stonehill, Alden, Bank of America and Wexford Capital, according to the companyās court papers.
The lender group argued to the company earlier this month that an out-of-court foreclosure would minimize disruption to its operations, according to court filings. Tupperware disagreed and filed for chapter 11 in the U.S. Bankruptcy Court in Wilmington, Del. A bankruptcy would provide ānotice and an opportunity to be heard to the companyās stakeholders in an open forum,ā the company said in its filings.
Lenders have opposed Tupperwareās bankruptcy filing, claiming that the process would be costly and that Tupperwareās plans for a sale likely wouldnāt succeed. They intend to object to Tupperwareās use of their cash collateral to fund its sale process in bankruptcy, and may also try to convert the case to a liquidation, the company said.