Creative Memories, a St. Cloud-based scrapbooking company, has filed for Chapter 11 bankruptcy, according to a letter filed with the Minnesota Department of Employment and Economic Development. Now the company has plans to lay off most of its staff at its St. Cloud headquarters. The layoffs are to total 163.
So far, the company has laid off around 70 employees and plans to lay off the remaining 91 employees in June.
Before the announcement of the bankruptcy, Creative Memories had 230 employees working at its headquarters in St. Cloud, meaning only 30 percent of the workforce will be left after the layoffs occur. Creative Memories does not plan to discontinue its operations. They believe that the action will allow them to make the necessary changes that will allow them to return to long-term success. The plan is to emerge as a business that is more focused on a strategy and more nimble, giving families the tools that they need to tell their stories and celebrate their lives through scrapbooking.
An exact date has not been set for the additional layoffs, but the range is between June 15 and June 28. The layoffs are said to be the result of business volume fluctuation with the layoffs being permanent unless the business circumstances change.
The parent company, The Antioch Company, LLC, which is a manufacturer of packages and recreational paper products, has also filed for bankruptcy in order to reorganize their finances while continuing business.
Creative Memories expects the reorganization process to last around six months, which, if the court gives approval, it will emerge from the bankruptcy process.
So far it is known that the company has assets and liabilities that are between $10 million and $50 million. However, they have up to 25,000 creditors, according to their bankruptcy filing. Three of the creditors are owed in excess of $1 million. The largest claim is for an amount of $1/25 million to an individual in Florida.
In Minnesota, there are six businesses in the debt claim. The largest is the Brainerd-based Range Printing, which is owed over a half million dollars. Three local businesses, Midland Paper, GLS Integrated Communications, and C.H. Robinson Worldwide are owed over $100,000 a piece.
According to the Creative Memories website, the scrapbooking market has seen a major decline in recent times.
Creative Memories was founded in 1987 and this is not the first bankruptcy filing for the company. It also filed Chapter 11 in 2008 in an attempt to restructure debt. At that time, the company had over 55,000 sales consultants around the world. That number has now decreased to around 20,000.
If you have questions about Bankruptcy. Call Minneapolis Bankruptcy Attorney, Brea Buettner-Stanchfield at 612-377-5311.