Bed Bath & Beyond is closing 150 stores as part of its strategy to revitalize its struggling business.
Bed Bath & Beyond has been hurting for a while. As a consequence of its woes, the company announced that it will be closing 150 of its existing stores. The closures are a part of the company’s overarching efforts to revitalize its failing business.
The closures will affect Bed Bath & Beyond stores from coast to coast. However, the highest concentration of closures is clustered in the Northeast near where the company is headquartered in New Jersey. A list of the initial 56 locations that will shut their doors permanently is viewable here.
Bed Bath & Beyond asserted that the stores it has chosen to close have all been underperforming. The company’s logic behind the maneuver is that by shedding the stores that aren’t doing well, they will be able to allocate more resources to and better support stores that are. The company is hoping to drive sales as much as it can during the holiday season.
Bed Bath & Beyond is in a really precarious place right now. If they don’t do well this holiday season, it could mean the chain’s ultimate demise. After suffering at the hands of poor leadership and pandemic-induced challenges, the company is only left with $500 million in financing to work with.
For a chain that’s as large as Bed Bath & Beyond, $500 million isn’t exactly a lot of money. The company desperately needs to generate more cash flow. If it can’t, it’s unlikely that the retail titan will be able to secure more financing.
Prior to securing the $500 million, many of the company’s suppliers put holds on Bed Bath & Beyond’s accounts due to non-payment. If the retail giant is not able to start generating reliable cash flow to pay its suppliers and satisfy its outstanding debts it could end up suffering the same fate as Toys R Us. Toy R Us’ ultimate demise came about as a result of significant overhead that it was unable to recover from, the company just kept sinking farther and farther until it ultimately drowned.
One of the partial reasons for Bed Bath & Beyond’s current woes can be attributed to the mistakes made by its former CEO Mark Tritton. Prior to taking the helm at Bed Bath & Beyond, Tritton did wonders over at Target. He took his approach that worked so well for Target over to Bed Bath & Beyond but it turned out that that approach was not one size fits all and Bed Bath & Beyond ended up being left in a worse position as a result.
If Bed Bath & Beyond is not exceedingly careful with its next moves, it could very well end up six feet under. That being said, it is not all doom and gloom for the retailer. The company also owns BuyBuy Baby and it has seen growth on that side of the business.
Bed Bath & Beyond opened 5 new BuyBuy Baby locations during the first half of 2022, CNBC pointed out. Additionally, the retail titan has made it clear that they have no intentions of giving up just yet. The company is still on the hunt for new leadership that understands the business in such a way that will help it climb out of the current hole that it’s in.