Container giant (actual containers, not the virtualization tech) Tupperware shocked investors when it said yesterday that its business was looking less airtight than you might expect.
Yes, apparently people invest in Tupperware. Once a pioneer of stretching dinner into tomorrow and the next day and the next, the average kitchen may now possess a litany of plastic boxes and lids, and not one of them are stamped with the iconic brand.
But just like the tech sector, the company received a serious shot in the arm thanks to the pandemic as locked-down amateur cooks went cuckoo for banana bread all of a sudden, with sales tripling in 2020.
Also like the tech sector, those fortunes are now spoiling – hard – taking Tupperware back down to its pre-COVID trading environment, according to figures collated by Bloomberg.
Back in November, Big T emitted a "going concern" warning – accounting lingo meaning the business's future is uncertain – and poor earnings sent shares spiraling.
This week, however, Tupperware admitted in an SEC filing that it had called in financial advisors "to help improve its capital structure and remediate its doubts regarding its ability to continue as a going concern."
Rather than remediate doubts, though, investors were spooked and the company's value tumbled by almost 50 percent.
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How did we get here? Well, world+dog must have heard of "Tupperware parties" – the company's main marketing strategy for decades of getting existing customers to sell products in other people's homes.
But when was the last time you heard of anyone throwing or going to one of these Dionysian delights? Unfortunately for Tupperware, it's not the 1970s anymore, and people have more nuanced interests than what brands fill their kitchen cupboards.
This forced Tupperware to ditch the multi-level marketing and forge partnerships with retailers, like Target, in its ineffable quest to reach Gen Z and Millennials.
However, the company may have to make peace with the fact that it is just a plastic box business – one formerly so ubiquitous that people call any old sealable container "Tupperware" nearly 70 years after Earl S. Tupper first filed his patent for "removable lids or covers without integral tamper element secured only by friction or gravity inside a peripheral U-shaped channel in the mouth of the container."
The organization is now looking to improve its liquidity position by courting potential investors and financing partners, and selling off its real estate to have more cash on hand.
But unless something weird happens to reverse the sales collapse, the Tupperware party could be over soon. ®