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Bed Bath & Beyond cleans the house.
The retail giant, known for its ubiquitous coupons, has announced job cuts and store closures in a bid to cut costs as it continues to struggle with poor sales and a recent change in top leadership.
in Wednesday announcementThe New Jersey-based company has pledged to cut its workforce by 20% and close about 150 stores.
According to Seth Basham, managing director of financial services and investment firm Wedbush Securities, Bed Bath & Beyond is experiencing some of the same issues as other home furnishings retailers, such as declining sales and an increase in inventory that needs to be sold.
But he said the company has also been hurt by trying to overhaul its supply chain during the pandemic, which has led to a shortage of store shelves, as well as a failed switch from popular national brands to store-created private labels.
“This has led to more customer defection from Bed Bath & Beyond and more pressure on their sales trends,” Basham told NPR.
In 2019, the retailer named former Target CEO Mark Tritton as CEO. Part of his plan to revamp the company was to sell the merchandise on special Bed Bath & Beyond labels as Target does, but the idea didn’t spread the same way.
“At Target, there are a lot of consumables and other things [customers] Went to the store for it, and they came to love and enjoy the special brands they saw. “You didn’t have that drag at Bed Bath & Beyond.”
Triton left the company in June.
Although Bed Bath & Beyond got a boost early in the pandemic when many people were spending more time at home, the gains were short-lived and profits continued to fall.
The company said this week that net sales were about $1.45 billion in the second quarter of this fiscal year — down about 26% from the same period last year.
Interim Director and CEO Sue Goff said Bed Bath & Beyond, after taking a comprehensive look at our business, is now making some major changes.
The company expects an infusion of external funding from JP Morgan and investment firm Sixth Street Partners. The company said it is bringing back some beloved national brands, and will try to reconnect with customers through its loyalty program.
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