Bed Bath and Beyond Eyes to Close Stores, Plans to Cut Jobs in Rebound Bid

Bed Bath and Beyond has said that it will shutter stores and lay off workers in a bid to turn around its beleaguered business.

The home goods retailer based in Union, New Jersey, said it will close about 150 of its namesakes stores and slash its workforce by 20 percent. It estimated those cuts would save $250 million in the company’s current fiscal year. It also said it is considering selling more of its stock to shore up its finances and had lined up more than $500 million of new financing.

But it will keep its buybuy Baby chain, which earlier this year it considered selling. Bed Bath and Beyond’s stock fell more than 21 percent and is down 65 percent in the last 12 months.

Mired in a prolonged sales slump, the company also announced it will revert to its original strategy of focusing on national brands, instead of pushing its own store labels. That reverses a strategy embraced by its former CEO Mark Tritton, who was ousted in June after less than three years at the helm. It said it would get rid of one-third of its store brands, which had started to be rolled out in the last year or so.

Mara Sirhal, President of Bed Bath and Beyond said, “There’s still an incredible degree of love for Bed Bath and Beyond. We must get back to our rightful place as the home-category destination, and our goal is to achieve this by leading with the products and brands our customers want.

As of May, the retailer operated a total of 955 stores, including 769 Bed Bath and Beyond stores, 135 buybuy Baby stores, and 51 stores under the names Harmon, Harmon Face Values ​​or Face Values. As of February, it had roughly 32,000 employees.

Time is of the essence for the company heading into the critical holiday shopping season. It said it expects a 26 percent decline in comparable sales for its fiscal second quarter, which ended Saturday. It burned through $325 million of cash in the quarter.

Sirhal said the retailer wants to get back to being a place where shoppers find innovative items. For example, Bed Bath and Beyond were the first to bring items like the air fryer and the single-serve coffee maker to its customers, she said.

Neil Saunders, Managing Director at GlobalData Retail said he applauds the strategic shift. But he said that task is “easier said than done” and will require much closer relationships with suppliers to secure unique offerings.

If Bed Bath and Beyond simply stocks the same sort of things as can be found at Target, Walmart, or Amazon, then it will struggle to differentiate and will find margins compressed as it needs to match on price, ” he added.

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