Analysis: Bed Bath & Beyond needs more than just a management change
The resignation of Steven Temares as CEO of Bed Bath & Beyond is a necessary first step in revitalizing the fortunes of the beleaguered retailer.
Under Mr. Temares, Bed Bath & Beyond has lost market share as it has fallen behind peers and failed to keep pace with a changing homewares market. The lack of action, forward-thinking and urgency from the board have been the main reasons for this decline. In our view, it is right that Steven Temares takes responsibility and steps down.
However, as we have said before, shuffling the management team will not, in and of itself, produce the change that is required. As such, Bed Bath & Beyond now needs to search for a leader who can put in place a plan to refashion the company to the modern realities of retailing. Preferably, this should be someone with experience of rebuilding failed retail businesses.
Even with a new plan of action and leader at the helm, we do not believe that the problems at Bed Bath & Beyond are over. There will be many more painful quarters ahead as the company adapts and adjusts its model to one which can produce better growth. That may include closing stores, losing unprofitable sales, capital investment in shops and digital platforms, and streamlining outdated areas of the business. All of these things will cause disruption and pressure on the bottom line. They are, however, the price for long term survival.
The hope is that a new leader will grasp the nettle in the way that Steven Temares was not able or willing to do.
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