The bankruptcy filing of Paper Source Inc. is squeezing small vendors the stationery chain uses to stock its shelves with greeting cards, Bloomberg News reported. Paper Source placed unusually large orders with greeting card suppliers in the months and weeks preceding the bankruptcy, according to interviews with two vendors and an outpouring of online complaints. The bankruptcy filing means that payment for those orders may be delayed and, in some cases, possibly never repaid in full. “If they were worried that we wouldn’t ship to them, they should’ve just paid up front for the product,” said Janie Velencia, owner of The Card Bureau in Washington, D.C. “$15,000 to them, that’s nothing. To a small business like me, that’s payroll, that’s rent.” Paper Source ordered more from The Card Bureau in a 60-day period than it had in all of 2020, according to Velencia. The chain ordered $5,000 worth of merchandise within 20 days of the filing and $10,000 in the weeks before that, she said. Vendors were asked for larger-than-usual orders after the holidays because Paper Source needed to stock 27 new stores it acquired from Papyrus, another stationery chain that went bankrupt last year, Chief Executive Officer Winnie Park said in an emailed statement. Most of the orders will get a higher repayment priority in bankruptcy because of their proximity to the filing, Park said.
