LOGIN

Instant Pot Manufacturer Files for Bankruptcy Amid Slumping Sales

by Michael Nguyen
5 comments
Indiana Tornado

Instant Brands, the creator of Pyrex glassware and Instant Pot, is seeking Chapter 11 bankruptcy protection as the company reels under the impact of inflation and reduced consumer spending.

Documents filed this week with the U.S. Bankruptcy Court for the Southern District of Texas reveal that the company, located outside Chicago, holds over $500 million in both assets and liabilities.

Rising inflation post the pandemic-induced consumer spending spree on home goods has hit consumers hard. Simultaneously, the resumption of travel, dining out, and attending shows has led to a shift in spending patterns.

Moreover, Instant Pots, once a popular kitchen essential, have been gradually disappearing from households.

In 2020, at the onset of the pandemic, sales for “electronic multicooker devices,” primarily Instant Pots, stood at $758 million. However, by last year, this figure had dropped by half, settling at $344 million.

The NPD Group, a market research firm, reports a 20% decline in both dollar and unit sales from last year as of April.

S&P Global lowered the company’s rating just last week, citing reduced consumer discretionary spending. They further warned of another possible ratings drop should Instant Brands file for bankruptcy protection.

“Net sales shrank 21.9% in the first quarter of fiscal 2023 compared to the same period last year,” stated S&P analysts. “This represents the seventh quarter in a row of year-on-year sales decrease. The continual underperformance of Instant Brands is largely due to the reduced consumer demand as a result of decreased discretionary spending on home products.”

The pinch of surging inflation and high interest rates has also been felt by U.S. manufacturers.

Ben Gadbois, CEO and President of Instant Brands, acknowledged the company’s successful navigation through the COVID-19 pandemic and the ensuing global supply chain disruptions, but conceded to being cash-strapped.

“Elevated interest rates and stricter credit conditions have affected our liquidity and rendered our capital structure unsustainable,” Gadbois stated in a press release on Monday.

Instant Brands, also the parent company of Corelle, Snapware, CorningWare, Visions, and Chicago Cutlery, has secured a commitment for $132.5 million in debtor-in-possession financing from its current lenders.

Four years ago, the company was purchased by private equity firm Cornell Capital and subsequently merged with another kitchenware company, Corelle Brands.

The Chapter 11 filings do not include Instant Brands’ entities located outside the U.S. and Canada.

Frequently Asked Questions (FAQs) about Instant Brands Bankruptcy

What company has filed for Chapter 11 bankruptcy protection?

Instant Brands, the maker of Pyrex glassware and Instant Pot, has filed for Chapter 11 bankruptcy protection.

What factors have led to Instant Brands’ financial distress?

Instant Brands has been adversely affected by inflation, a shift in consumer spending away from home goods, and a decrease in sales of its once-popular Instant Pot device.

What has been the impact of inflation and changing consumer habits on Instant Brands’ sales?

Inflation and changing consumer habits, such as an increase in travel and dining out, have led to a decline in sales. Instant Pot sales, which stood at $758 million in 2020, plunged 50% by the following year.

Who is the CEO of Instant Brands and what did he say about the company’s situation?

The CEO of Instant Brands is Ben Gadbois. He stated that despite managing through the COVID-19 pandemic and global supply chain issues, the company has run short of cash due to tightened credit terms and higher interest rates.

What is the future of Instant Brands given the bankruptcy filing?

Instant Brands has secured a commitment for $132.5 million in debtor-in-possession financing from its current lenders. However, the outcome of the bankruptcy proceedings will ultimately determine the company’s future.

More about Instant Brands Bankruptcy

You may also like

5 comments

SamuelW June 14, 2023 - 1:05 am

inflation hitting everyone hard these days. tough time for businesses.

Reply
JennyLovesCooking June 14, 2023 - 2:46 am

This is a shock! My Instant Pot is a lifesaver. Can’t believe they’re struggling.

Reply
EconGuy June 14, 2023 - 9:11 am

Look at the bigger picture, people. It’s not just about Instant Pot. It’s a sign of wider economic issues.

Reply
KitchenGuru101 June 14, 2023 - 6:03 pm

Instant Pots were a fad, imho… it’s just normal the sales have cooled down.

Reply
Sarah_Momof3 June 14, 2023 - 8:07 pm

Wow, we really do take our home appliances for granted. Hope they pull through this!

Reply

Leave a Comment

logo-site-white

BNB – Big Big News is a news portal that offers the latest news from around the world. BNB – Big Big News focuses on providing readers with the most up-to-date information from the U.S. and abroad, covering a wide range of topics, including politics, sports, entertainment, business, health, and more.

Editors' Picks

Latest News

© 2023 BBN – Big Big News

en_USEnglish