Bed Bath & Beyond to refresh 160 stores in time for holiday; to announce new CEO soon
Bed Bath & Beyond detailed several short- and long-term initiatives as part of ongoing efforts to transform its namesake brand.
In a letter to shareholders, the struggling retailer said a “rapid refresh” of nearly 160 Bed Bath & Beyond stores is underway in advance of the upcoming holiday season. The company expect the “multi-million-dollar investment” to favorably impact the in-store shopping experience over the short term.
Bed Bath & Beyond also promised to close underperforming stores during the next couple of years to take advantage of its heavy lease expiration cadence.
In addition, the chain is embarking on an “aggressive reduction” of up to $1 billion in inventory during the next 18 months, including removing excess aged inventory from its stores ahead of the 2019 holiday season.
“This effort should allow us to quickly reset inventory levels in both our stores and distribution centers, as well as refresh our assortment, providing for newness and higher-margin products, all in an effort to drive customer traffic and support top-line performance,” Bed Bath & Beyond said in the letter, which was signed by Patrick R. Gaston, chairman, and Mary A. Winston, interim CEO.
The retailer also said it has made “substantial progress” has been made in its search for a permanent CEO, with an announcement due in the coming weeks.
Longer-term, Bed Bath& Beyond said it is implementing a comprehensive store renovation program that will be done in conjunction with further investments in its digital channels along with marketing and loyalty initiatives. It also will change its sourcing and buying to increase its private-label offerings, which should yield significant cost savings during the two to three years and provide further product differentiation and a more favorable margin structure, the company stated.
In other changes, the reporting structure for the company’s other retail chains and e-commerce businesses (which include Christmas Tree Shops, buybuy Baby, Cost Plus World Market and Harmon) have been streamlined under one leader, who was not identified. Bed Bath & Beyond said it working with outside advisors, including Goldman Sachs, to evaluate “several different opportunities” related to the businesses.
In summing up, Bed Bath & Beyond said that its focus on putting the customer at the center its transformation, supported by data and insights, is intended to restore the company to its “iconic status and improve its position.”
“While our teams are moving rapidly to address many near-term opportunities to stabilize the business and lay the foundation for sustainable growth, these are just the first steps in the company’s ongoing business transformation,” Bed Bath & Beyond stated.
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