Bedbath & Beyond, the beleaguered home goods retailer, said Wednesday it plans to close 150 stores and cut spending.
The retailer, which is also considering layoffs, said it has secured $500 million in new funding.
The funding will give retailers time to increase store visits and implement turnaround strategies focused on stocking more of the items shoppers want to buy in stores. As shoppers spend less, they want to regain market share lost to their competitors. The company has about 1,000 stores.
Sue Grove, Interim CEO of Bed Bath & Beyond, said in a statement:
Retailers weighed down by double-digit decline in sales, negative cash flow, supply chain issues and changing consumer shopping habits away from spending to refurbish homes at high levels early in pandemic It has been.
Bed Bath & Beyond also provided a tough financial update for the second quarter of the fiscal year ended August 27. The company said comparable sales fell 26% year-on-year and posted negative cash flow. The company said he plans to spend $250 million on capital expenditures this year, a significant drop from his previous plan of $400 million.
The company’s shares have fallen more than 20% in pre-market trading in recent months. Stocks have been on the rise this year, with sharp declines continuing as of Wednesday.
Analysts and shoppers feel Bed Bath & Beyond has moved away from what was once a major player in the industry. The company said it will focus on national brands, as opposed to focusing on expanding its own brands, which have not resonated with customers as much as hoped. announced that it will abolish one. Some of them have rolled out in the last year and a half.
“The most important thing for their long-term viability is adding capital,” Seth Basham, an analyst at Wedbush Securities, said in an interview before the company’s announcement. Next, it’s important to change the company’s “value proposition,” and “that second part of him is the hard part,” he said.
Bed Bath & Beyond is working with an executive search firm to find a full-time chief executive, even after Mark Tritton, who had held the top spot since late 2019, stepped down in June. We are in the early stages of the search process and will provide updates when appropriate,” the company said.