Bed Bath & Beyond is moving forward on its restructuring efforts, and due to that, have taken a drastic turn, as the company announced it will be shutting down all 54 of its Bed Bath & Beyond stores and 11 Buybuy Baby outlets. The retailer, which raised more than $1 billion in an equity offering of preferred stock earlier this month, had hoped the infusion of capital would allow it to keep operating in Canada.
However, Bed Bath & Beyond Canada (BBB Canada) has declared itself insolvent and concluded that the equity offering did not raise enough capital to restructure its US stores and bring its Canadian business back to profitability. Having said this, you can infer where the 54 and 11 location stores will be closing.
Say Goodbye to Bed Bath & Beyond in These Locations
As a result of this complex situation, the company has been forced to liquidate its inventory and vacate all leased retail stores and premises in Canada. This move will leave many employees without jobs and further exacerbate the retail industry’s ongoing struggles in the country.
The news isn’t much better for Bed Bath & Beyond’s operations in the US, where the company is planning to reduce its footprint by half. The retailer has already closed 150 of its “lower-producing” Bed Bath & Beyond stores and is shutting down its Harmon cosmetics chain, leaving only 360 Bed Bath & Beyond stores and 120 Buybuy outlets. The company claims this move is a part of a “strategic update” that will allow it to focus on its most profitable locations and its digital channel, which is generating a higher proportion of sales.
However, this restructuring is likely to result in further job losses and the closure of many beloved stores across the country. It’s unclear if the remaining Bed Bath & Beyond stores will be able to compete in an increasingly crowded retail space, especially given the rise of online shopping and the impact of the COVID-19 pandemic on consumer behavior.
What the Future Holds for Bed Bath & Beyond
Bed Bath & Beyond’s decision is to pursue “asset-light” inventory management strategies, including vendor-direct-to-consumer and marketplace sales. This may help the company cut costs in the short term, but it remains to be seen if these measures will be enough to ensure the retailer’s long-term survival.
As the inventory is on rebate in the Canadian locations, costumers will find incredible prices for amazing product. Nonetheless, this news is a devastating blow for Bed Bath & Beyond and its employees, as well as for the retail industry as a whole. The brick-and-mortar stores are struggling in the age of e-commerce. Companies that are not ready to embrace the change, will be left behind.