Party City store closures started a war to win over its customers. Two very different retailers are on the front lines

Michaels is expanding its party supply and celebration offerings. 

In September 2025, the arts and crafts retailer introduced The Party Shop at Michaels, an in-store shopping experience that brought party supplies, balloons, and other celebration essentials to its shelves.

This year, its product selection will grow even further. 

In a May 13 press release, Michaels announced it is expanding its in-store party supply assortment and introducing new in-store experiences, with plans to add nearly 600 new products to its shelves throughout 2026.

Michaels isn’t the only unexpected retailer with a party supply aisle. Last month, Staples announced it was getting into the party business with help from Party City. The office supply retailer shared plans to add Party City at Staples shop-in-shops to more than 700 of its stores. 

Party City filed for bankruptcy for a second time in December 2024 and announced it would close all of its stores. Its departure left many shoppers without a go-to retailer for party supplies and balloons.

In the wake of its store closure, retailers like Staples and Michaels are filling the gap.

Michaels offers new ways to prepare for your next party 

In the past year, Michaels has expanded its party supplies and balloon offerings to over 4,500 products. The retailer isn’t slowing down—it plans to add around 600 new products by the end of 2026, bringing even more celebration finds to shelves.

New products include piñatas, expanded licensed essentials featuring characters like Hello Kitty and Bluey, and year-round entertaining products. 

Michaels is also introducing new in-store experiences. Beginning this month, the craft retailer is rolling out the following in-store DIY customization bars across North America: 

• The Favor Bar: Mix and match items to build custom party favors.
• The Candy Bar: Fill favor bags or create dessert displays with an assortment of sweets.
• The DIY Banner Bar: Create personalized felt banners with interchangeable numbers, letters, and icons.

And for those who need gift wrap, Michaels will have an assortment of gift wrap and bags, bows, tags, and tissue paper—customers can mix and match five items for $5.

“At Michaels, we believe the joy of celebrating should begin the moment you start planning,” David Boone, CEO of Michaels, said in a statement. 

Shop-in-shops are the latest way retailers are expanding

The Party Shop at Michaels isn’t the only in-store shopping concept that the craft retailer offers. Last year, Michaels also welcomed The Knit & Sew Shop. The shop features Joann and Michaels-branded sewing and crafting essentials like yarn, thread, and fabric. 

In 2025, the arts and fabrics chain Joann Inc went bankrupt and closed all its remaining stores. In June 2025, Michaels acquired Joann’s intellectual property and private label brands.

Shop-in-shops like The Knit & Sew Shop and The Party Shop at Michaels allow retailers to expand their offerings and appeal to a wider customer base without expanding their physical footprint by opening new stores.

Both Michaels and Staples are privately held companies after formerly being publicly traded. The Michaels Companies was taken private in 2021 by Apollo Global Management. Staples Inc was bought in 2017 by Sycamore Partners.

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