The traditional household goods brand is in serious financial difficulties and announces that the company may not have sufficient liquidity in the near future.
Household goods manufacturer Tupperware is struggling to survive. The traditional American company has now announced that it has “significant doubts” about its ability to continue as a going concern. There was already such a “going concern” warning last November, but this time it sounded a lot more dramatic. Tupperware said it may run out of “sufficient liquidity” in the near future.
After this announcement, the share price fell by almost 50 percent to just $1.24. A year ago the share cost around 20 dollars, in 2013 the price was almost 100 dollars.
Tupperware has been shrinking for years. In 2022, the company’s sales fell 18 percent to $1.3 billion. Ten years ago it was almost twice as much. In the midst of the lockdowns in the corona pandemic, Tupperware experienced an interim growth spurt, but it was back very quickly. CEO Miguel Fernandez said when presenting business figures in March that the company had started last year with optimism about improving its economic situation, but had not succeeded.
The housewares manufacturer traces its history back to 1946. Founder Earl Tupper, a chemist, took paint can lids as inspiration to develop airtight plastic storage jars for the home. This should help families in the post-World War II era to keep their groceries fresher and thus save money.
Tupper initially found it difficult to explain the benefits of its products to consumers, and so the idea was born to demonstrate the containers directly to potential customers at home. The first “Tupperware Party” was held in 1948, and this sales method was so successful that the manufacturer soon focused exclusively on it and removed its tins from stores.
Tupperware became a cult, and other companies followed the direct selling model. But parallel to the decline in sales, the number of active Tupperware consultants has been shrinking for some time now. In 2022 there were 284,000, five years ago there were more than twice as many. Direct sales remain the core of the business to this day, although last fall the company formed an alliance with major US retailer Target, which has been selling Tupperware goods in its stores ever since.
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Tupperware has now announced that it has hired financial advisors to find additional sources of funding. In addition, cost reductions and the sale of real estate would be examined. The company also admitted that it may have breached credit terms by failing to file its annual report on time. For this reason, it was also warned by the New York Stock Exchange against delisting its shares.
What: FAZ
