Bed Bath & Beyond Inc. and subsidiaries (“BBB”) operates a chain of retail stores under the names Bed Bath & Beyond in the United States, Canada and Mexico, as well as, World Market, Cost Plus World Market, Christmas Tree Shops, and That!, Harmon, Harmon Face Values and buybuy BABY in the United States. The Company is also a partner in a joint venture, which operates retail stores in Mexico under the name Bed Bath & Beyond.
The Company was founded by Warren Eisenberg and Leonard Feinstein in 1971 when they opened their first store in northern New Jersey called Bed ‘n Bath. By 1985, the Mr. Eisenberg and Feinstein were operating 17 stores in the New York metropolitan area and California. They also opened their first superstore in 1985 and changed their name to Bed Bath & Beyond.
Through its retail stores the Company sells a wide assortment of domestics merchandise and home furnishings primarily for the bedroom and bathroom. The Company's over 1,400 stores principally range in size from 15,000 to 50,000 square feet, with some stores exceeding 80,000 square feet. Bed Bath & Beyond has 1,014 locations in 2014. Additionally, the Company includes Linen Holdings, a business-to-business distributor of a variety of textile products, amenities and other goods to customers in the hospitality, cruise line, food service, healthcare, and other industries.
The Company’s objective is to be the customer’s first choice for products and services in the categories offered, in the markets in which the Company operates. The Company’s strategy is to achieve this objective through excellent customer service, an extensive breadth and depth of assortment, everyday low prices and introduction of new merchandise offerings, supported by the continuous development and improvement of its infrastructure.
Financials
Bed Bath & Beyond is a publicly traded company on the NASDAQ under the symbol “BBBY”. The Company’s stock price was trading at $73.54 as of review date. The stock’s low point over the last year was $54.96. BBB’s fiscal year end is March 1st. Trailing twelve months as of 11/29/14 Revenue is $11.75B, Gross Profit of $4.57B and EBITDA of $1.79B. As of quarter end 11/29/14, BBB had $1.18B of Cash on their balance sheet. BBB has a Market Cap of $13.35B and 181.57M shares outstanding. The Company has exhibited single digit Revenue growth over the last 3 fiscal years and their Net Income has remained relatively flat year over year. Analysts that cover BBB expect similar modest revenue and profitability growth in the future.
The Company appears to be at the mature stage of it’s life cycle as evidenced by it’s single digit growth year over year. The Company’s modest Revenue growth appears to be a result of new store openings, approximately 13 new stores openings on average per year, as well as an increase in e-commerce sales. The Company’s Revenue is largely dependent on the recovery of the Housing Market, which has seen in improvement since the most recent economic downturn.
Company location
BBB is headquartered in Union, NJ. A majority of BBB’s 1,000+ retail locations are in California, Texas, New York and Florida.
Employment
BBB has over 47,000 employees and offers multiple positions in its retail locations including sales and customer service associates as well as division and store managers. Average salaries for sales and customer service associates range from $9.00 to $10.00 per hour. Management positions range from $50,000 to $73,000 in annual salary.
The Company appears to have a positive work environment for its employees as evidenced by employee’s reviews. Some employees voice complaints about lack of training, company’s stinginess or repetitive nature of job. However, overall employees enjoy the company’s culture and working with their colleagues.
Marketing Approach
BBB does not seem to do much marketing through TV and media. Most of the marketing outreach I've seen is through direct mail and e-mails. The Company frequently mails 20% coupons that can be used for a single product purchased in store (not available for Online purchases). This is very attractive for larger purchases, especially for kitchen/coffee electronics or dishware with typical retail cost above $100. Additionally, they mail out a monthly catalog that typically has a $5 coupon that can be used for a single product.
BBB conducts e-mail marketing in which they e-mail you 20% coupons that can be used for a single product and includes online purchases. E-mail distribution seems to be less frequent than their direct mail distribution. I believe their e-mail database comes from sales associates requesting buyers e-mail addresses during in store purchases or when an online purchase is made.
Like 20.73% of website visitors, I typically go directly to their site as they are the most well-known retailer for bedroom, bath and kitchen products. I will always check their website directly when I'm seeking to purchase products in these categories.
A majority of their Referrals appear to be from wedding oriented websites such as theknot.com and weddingwire.com. BBB is a top retailer for wedding registries. Many couples seeking to register will manage their registry on the website. And guests looking to purchase gifts on those registries will visit the website to make a purchase.
Vendors
The Company sells a combination of products purchased directly from manufacturers or wholesale distributors. Vendors are mostly US wholesale distributors/importers. Their vendors supply BBB with private label and licensed or branded goods. For example, the retailer's home cleaning products are supplied through a distributor selling under the brand Casabella.
Size of Operation
With over 100 store locations and $11B+ in Revenue, BBB is considered a very large volume retailer in terms of orders and customer size.
Customer Service
Bed Bath & Beyond is famous for their liberal return policy. Basically, you can return any item sold at BBB to any store, regardless if it was even purchased at a BBB. There does not seem to be any time limit on this as I've returned items that I purchased, without a receipt years after use. They gladly accept returns and do not require the item to be in its original condition or packaging. If you purchase online, the order will come with a pre-paid shipping label so you can process your return for free and send back to their returns processing center. It cannot be any easier.
BBB has a 24/7 customer service phone number as well e-mail support. They also have a link on their Website to submit customer feedback.
Resellerratings.com indicates a score of 4.67 out of 10 for customer service. The below average score is related to several complaints about delayed shipping times or discontinued products. I personally have never had any issues with timely receipt of Online orders. Packages usually arrive in less time than indicated on the order confirmation.
Shopping Experience
I have found the in store shopping experience to be satisfactory. The upside is that they have knowledgeable staff and a very large selection of inventory in the categories they sell. The downside is, and this is in their NYC stores, the lines can be very long to check out and even longer when you need to return/exchange goods at their Customer Service desk. Additionally, it is difficult to find an associate to assist you and there is limited staff on the floor.
The Online shopping experience is satisfactory as well. Their Website seems to be older and not as clean as other major retailer Websites such as Wal-Mart and Target. However, I have never had any issues finding an item by either entering the item in the Search box or finding it by brand or category on their dashboard tabs. They have a lot of search options such as "by brand", "by color", "by price", etc. The checkout experience is pretty seamless and secure. It does not take long. My only issue is that you are not able to use the 20% coupons you receive in the mail towards Online purchases, only the e-mail offers you receive. They offer free shipping on orders above $49, which is great. They have a 24/7 Hotline that offers support in case any issues are encountered.
Difficult to get an associate to assist you, especially in the Registry section
Extra charge for gift wrapping
Final Words
Bed Bath & Beyond is one of the only retailers with the breadth of selection in the home category. You can pretty much find anything you are seeking when it comes to a kitchen, bedroom or bathroom item. It is also where most couples decide to do their registry. While they don't discount their products like some retailers who have frequent sales or offer below MSRP prices, BBB does frequently mail out 20% off single item coupons. I have never had any issues with their products or service and I will continue to be a loyal customer. I highly recommend this company for your next Online home purchase.
Bed Bath & Beyond was an American big-box retail chain specializing in housewares, furniture, and specialty items. Headquartered in Union, New Jersey, the chain operated stores in the United States and Canada, and was once counted among the Fortune 500 and the Forbes Global 2000. The chain filed for Chapter 11 bankruptcy in April 2023 and liquidated all of its remaining stores, with the last closing on July 30, 2023. Following the retail chain's liquidation, its name was adopted by online retailer Overstock.com, which acquired the company's trademarks in a bankruptcy auction. The name is also still used by the chain's former Mexican division, which is now independent.
Retail history
Warren Eisenberg and Leonard Feinstein worked in management positions at discount store chain Arlan's. As the company suffered financial difficulties, and the two believed that the market would shift toward specialty stores, they decided to leave and form their own company. In 1971, they opened a store in Springfield, New Jersey, called Bed 'n Bath. By 1985, Eisenberg and Feinstein were operating 18 stores in the New York metropolitan area and California. Also in 1985, the first superstore was opened, as an attempt to remain competitive with Linens 'n Things, Pacific Linen, and Luxury Linens. In order to properly represent the size increase in its retail stores, the company changed its name to Bed Bath & Beyond in 1987.
Growth and acquisitions
By 1991, Bed Bath & Beyond had opened seven new superstores in New Jersey, California, Virginia, Illinois, Maryland, and Florida. The following June, the company made its IPO on the NASDAQ stock exchange. The company adopted integrated computer-based inventory management systems in 1993 to better compete with Linens ‘n Things, which had utilized computer inventory management since the late 1980s. The chain's 100th store opened in Irvine, California, in October 1996; the 200th, in Palm Beach Gardens, Florida, followed less than three years later in August 1999. That year, Bed Bath & Beyond reached $1 billion in sales for the first time.
In 2002, Bed Bath & Beyond acquired Harmon Discount Health & Beauty, later renamed Harmon Face Values. Five years later in 2007, the company acquired Buy Buy Baby, a chain of baby supply stores founded by Feinstein's sons, and began international expansion, opening their first Canadian store in Richmond Hill, Ontario. By 2011, Bed Bath & Beyond had 1,142 stores. In 2012, the company acquired Cost Plus World Market for $495 million.
In 2016, the company acquired One Kings Lane, a luxury furniture e-commerce retailer; the following year, the company acquired Decorist, an online interior design platform.
Decline
In March 2019, three activist investment firms—Legion Partners, Macellum Advisors, and Ancora Advisors—announced their intent to remove current CEO Steven Temares and restructure Bed Bath & Beyond's current board of directors. The activist investors highlighted several instances of perceived nepotism, including the acquisition of Buy Buy Baby, which was founded by two of Bed Bath & Beyond co-founder Leonard Feinstein's children, and the acquisition of Chef Central, which was created by co-founder Warren Eisenberg's son, as examples of poor business practices at Bed Bath & Beyond. This pressure led five independent directors to step down on April 22, 2019, and also resulted in the company restructuring its board to include only 10 directors instead of the previous 12 members.
On April 13, 2019, there was a report that the chain would close 40 stores but open 15 new locations.
On May 13, 2019, Bed Bath & Beyond announced that CEO Steven Temares would step down "effectively immediately" and would resign his seat on the board of directors. Mary Winston, who had been appointed to the company's board as a result of the activist investment firms' efforts, replaced Temares as interim CEO. On November 4, 2019, Mark Tritton, previously chief merchandising officer at Target, started as Bed Bath & Beyond's CEO.
To combat declining profitability, Bed Bath & Beyond, which had for decades used coupon mailers and other promotional discounting tactics to attract consumers, announced in April 2019 that it would reduce its use of promotional coupons and tighten restrictions on their use. The chain also announced the development of new private label brands and concept stores.
As of 2019, Bed Bath & Beyond operated approximately 1,530 stores in all 50 U.S. states, as well as in the District of Columbia, Puerto Rico, and Canada. In addition to more than 1,020 Bed Bath & Beyond stores, the company also operated approximately 280 Cost Plus World Markets, 100 Buy Buy Baby stores, roughly 80 Christmas Tree Shops, and more than 50 Harmon stores.
Bed Bath & Beyond announced in January 2021 that it would stop selling MyPillow, citing poor sales. The announcement came in the wake of the January 6 United States Capitol attack, that CEO Mike Lindell supported conspiracy theories and efforts to overturn the 2020 presidential election, and amidst similar announcements by Kohl's and Wayfair.
Divestitures
Throughout 2020, Bed Bath & Beyond sold many of its subsidiaries. First, in April, One Kings Lane was sold to CSC Generation. Later that year in October, the company announced plans to sell the 80-store Christmas Tree Shops chain, along with its Massachusetts distribution center, to Massachusetts-based Handil Holdings LLC; the acquisition was finalized the following month. Finally, in December 2020, the company also announced plans to sell Cost Plus World Market to Front Burner LP; that sale was later finalized in February 2021.
Bed Bath & Beyond announced in July 2020 that it planned to close more than 200 stores, about 21% of its fleet, over two years, citing the COVID-19 pandemic. 63 locations targeted for closure were named that September, followed by another 43 in January 2021. In January 2022, Bed Bath & Beyond announced the closure of 37 more locations.
In March 2022, Ryan Cohen, former CEO of Chewy and a large shareholder of Bed Bath & Beyond, sent an open letter, as part of a Schedule 13D filing, to the Board of Directors calling for Buy Buy Baby to be sold or spun off at a favorable valuation. Subsequently, Bed Bath & Beyond reached a deal to give Cohen three board seats in exchange for his cooperation and the creation of a committee to execute his proposed plan. In July 2022, FCM BBBY Holdings, LLC, managed by Jake Freeman, also sent an open letter, as part of a Schedule 13G filing, asking the board of directors to consider their proposed plan to reduce Bed Bath & Beyond's debt and improve liquidity through convertible bond issuance.
In July 2022, significant changes to the company's executive leadership were announced: Mark Tritton would leave his role as president and chief executive officer, to be replaced by Sue Gove in an interim capacity. That August, the company announced that 20% of its corporate staff would be laid off, and 150 more stores would be closed. Gove was promoted to permanent president and CEO the following October.
On September 2, 2022, Gustavo Arnal, the company's chief financial officer, committed suicide, jumping from the balcony of his New York City apartment. Arnal was one of the targets of a class action lawsuit alleging that Bed Bath & Beyond's stock had become a pump-and-dump scheme. Two weeks later on September 16, the company named 56 stores targeted for closure of the 150 announced in August; later, on September 26, the company announced the closure of Decorist.
Bankruptcy and liquidation
Bed Bath & Beyond opened 2023 by warning investors that it might not survive the year. On January 5, shares of the company plunged almost 30% on the stock market, and the company announced it had "substantial doubt" in being able to continue to operate as a business. Wall Street analysts predicted that the company could file for Chapter 11 bankruptcy as soon as January 7. On January 9, Bed Bath & Beyond hired AlixPartners as a restructuring adviser, and announced the closure of 62 more stores.
Bed Bath & Beyond announced on January 26 that some banks had cut its line of credit. The next day, it was revealed that the company would shutter its Harmon Face Values chain, closing all 52 of its stores, and would also close five Buy Buy Baby stores and 87 Bed Bath & Beyond locations, including the last location in West Virginia.
On February 7, 2023, Hudson Bay Capital Management and several other investors arranged a public stock offering to raise over $1 billion to help the company avoid bankruptcy.
On February 10, 2023, it was revealed the company would shutter its Canadian division, closing all 54 Bed Bath & Beyond and 11 Buy Buy Baby stores in Canada. According to court documents, the business does not have the "capacity or ability to independently effect a recapitalization or restructuring of the Canadian operations without access to cash and the support". The same day, they also announced 149 more store closures in the United States, including the last two locations in Wyoming.
Bed Bath & Beyond announced on March 30 that if it was unable to sell $300 million in stock, the company would likely file for bankruptcy. In addition it also terminated its fundraising deal with Hudson Bay Capital Management.
On April 23, 2023, after failing to pay off stock, declining sales, high debt, and years of struggling, Bed Bath & Beyond, Buy Buy Baby, and 73 affiliated debtors and entities officially filed for Chapter 11 of the United States Bankruptcy Code in the United States District Court for the District of New Jersey. It was later confirmed that all remaining Bed Bath & Beyond and Buy Buy Baby stores in the United States would close unless a buyer was found for the chain. Even if the company could find a buyer, shareholders could be expected to be wiped out, with proceeds from the liquidation going to secured creditors and bondholders. By May 3, the company's stock was delisted from the Nasdaq exchange.
Following the bankruptcy filing, Bed Bath & Beyond stopped accepting their popular coupons on April 26, and liquidation sales commenced at all remaining stores the next day. Shortly thereafter, numerous other retailers, including The Container Store, Big Lots, Boscov's, and Kirkland's, announced that they would honor unused Bed Bath & Beyond coupons for a limited time. Liquidation sales continued through June and July, with the last stores closing permanently on July 30, 2023.
Industry analysts attribute Bed Bath & Beyond's failure to a number of factors, including a late entry to e-commerce, reduction in merchandise selection and quality, supply chain issues, competition from Walmart, Target, and HomeGoods, and debt accrued from stock buybacks. The latter is widely considered the largest reason for Bed Bath & Beyond's collapse, as the company's stock buyback schemes, in practice since 2004, were the source of much of its $5.2 billion debt. This resulted in an inability to pay vendors on time, which led many to halt merchandise shipments to the company.
Acquisition by Overstock.com and online revival
In a June 2023 bankruptcy auction, Overstock.com acquired the Bed Bath & Beyond name, and associated intellectual property, in a $21.5 million stalking-horse bid. Shortly thereafter, Overstock publicly announced its intention to rebrand its own operations under the Bed Bath & Beyond name after the acquisition closes. It did so on August 1, 2023, two days after the last brick-and-mortar Bed Bath & Beyond stores shuttered.
The acquisition did not include the now distant Buy Buy Baby brand, as bids were still being solicited for a separate sale of the chain until July; after no satisfactory bids were received, Buy Buy Baby's name and intellectual property were instead auctioned. A $15.5 million sale of the chain's intellectual property to New Jersey-based Dream On Me is pending.
Following the sale of the brand to Overstock, Bed Bath & Beyond, Inc. changed its name to 20230930-DK-Butterfly-1, Inc. and cancelled its stock on September 29, 2023.
Revival of Canadian stores as Rooms + Spaces and Babies "R" Us
The retailer's last Canadian stores closed four days earlier than planned in late April 2023. Following the closure of the chain's operations in Canada, Doug Putman, owner of Sunrise Records and Toys "R" Us Canada, acquired 21 former Bed Bath & Beyond locations, with plans to revive the chain in Canada as Rooms + Spaces, under the leadership of former Bed Bath & Beyond Canada general manager Greg Dyer. Putman also opened the first two stand-alone Babies "R" Us locations in Canada, in Edmonton in former Buy Buy Baby locations. The first Rooms + Spaces and stand-alone Babies "R" Us locations opened in July 2023.
Most stores were closed after being open for only a few months, as the leases were defaulted. As of February 2024, only two Rooms + Spaces locations remain open (at West Edmonton Mall and Brantford.)
Leases for other locations in Canada were acquired by other retailers, including Mark's and Pro Hockey Life.
Christmas Tree Shops bankruptcy
On May 5, 2023, Christmas Tree Shops also filed for Chapter 11 bankruptcy, despite having been separated from Bed Bath & Beyond two years prior. The now-independent chain later announced in July that it would liquidate; its last stores closed on August 12, 2023, two weeks after Bed Bath & Beyond.
Former subsidiaries
Bed Bath & Beyond Canada L.P. (2007–2023) – opened in 2007; operated 53 stores across 9 Canadian provinces; liquidated and closed in April 2023; brand relaunched in Canada by Overstock.ca alongside US relaunch in August 2023
Bed Bath & Beyond México – a joint venture with Home & More, S.A. de C.V to operate stores in Mexico under the Bed Bath & Beyond name. The Mexican unit is not affected by the closure in the US and Canada and will continue to operate normally.
Buy Buy Baby – founded by Richard and Jeffrey Feinstein; acquired in March 2007; closed with company in July 2023
Harmon Face Values (2002–2023) – acquired in March 2002; closed in February 2023
Cost Plus World Market (2012–2021) – acquired in May 2012; sold in February 2021
Christmas Tree Shops (2003–2020) – acquired in 2003; sold in 2020; closed in August 2023
One Kings Lane (2016–2020) – acquired in June 2016; sold in April 2020
Linen Holdings (2012–2020) – acquired in June 2012; sold in October 2020
Of a Kind (2015–2019) – acquired in August 2015; closed in October 2019
Decorist (2017–2022) – acquired in 2017; closed in September 2022
References
Further media
Why Bed Bath & Beyond Is Facing Extinction (video). CNBC. August 1, 2019.
