Scrapbooking companies have been falling like dominoes lately, as four well-known companies have shut down, filed for bankruptcy (or both) since early December.
California-based GCD Studios filed for Chapter 7 (liquidation) bankruptcy in early December, listing assets of less than $2,000 and debts of over $2 million. The company ceased operations in late 2013, listing no profits for 2013 and a little over $300k for 2012. The vast majority of GCD’s debt is to investors, including owner/president Michael Rountree.
In it’s heyday, GCD boasted ground-breaking lines from industry luminaries like Melody Ross, Heidi Sonboul, Kathy Davis, and Donna Salazar, and was one of the first companies to try to bring the concept of mixed media to the masses in the scrapbook segment through lines like Ross’s Chip Art. Sonboul has now launched her own company at the CHA show in January, and Salazar continues to build her licensed line through other companies. Ross appears to be focusing on her retreat business for the moment.
Shortly before Christmas, Canvas Corp filed a petition for Chapter 11 bankruptcy. Canvas Corp produces the Canvas Home Basics line of products and is also the owner of the 7Gypsies and Tattered Angels brands. The company’s roughly $1million in assets are outweighed by over $3million in debt, the majority of which is spread between their product suppliers, tax entities, and investors.
Canvas Corp has continued to operate while in bankruptcy. They exhibited with new lines at the CHA Mega Show in January (although adjustments made for the inability to use their regular suppliers were evident). A few days ago, the company requested an extension from the court on the deadline for them to propose a bankruptcy plan, saying they were making progress negotiating with creditors. A motion has also been filed requesting that May 5th be named as the last day to file creditor claims in the case. Neither motion has received a ruling yet from the bankruptcy court.
Lily Bee Design
Lily Bee Design, which would have celebrated its fifth anniversary in February, announced the end of January that it was suspending operations indefinitely due to the health and family issues of owner/designer Kristen Young. Lily Bee has been a personal favorite of mine since their launch, and is popular for it’s simple cheery designs in pure color palettes. Hopefully we will see Young’s talent again in the crafts industry, either through the re-launch of Lily Bee or via another avenue.
Splash of Color
At the end of March it became apparent in dramatic fashion that the partnership that made up Splash of Color had imploded. Formed by the owners of Creative Imaginations and Luminarte, the California-based company had launched several years ago with Marah Johnson (well-known designer and fiance of Creative Imaginations owner Jack Behlmer) as its Vice President & Brand Manager. The new company maintained two offices – a Fresno office that was a legacy of Luminarte, and a Huntington Beach office that was a legacy of the Creative Imaginations entity.
Signs of trouble in the partnership emerged on March 21st, when Johnson posted on her personal website that co-owner Leslie Ohnstad (who had been the owner of Luminarte prior to the partnership) had allegedly laid off the staff in the company’s Fresno office without the knowledge of her partner, Marah’s fiance. In the following days, Johnson showed what she said were pictures of the company’s Fresno office, empty of equipment and inventory, and alluded to the use of private investigators (and even to police reports on Facebook). Finally on April 8th an notice was placed on all of the company’s various social media outlets saying Splash of Color is unable to fulfill orders and is thus, essentially, closed. (All of the posts referenced here, except the closure notice, have since been taken down.)