Bed Bath & Beyond, America's largest specialty baby product retailer, will close its 120 stores as a result of the bankruptcy filing by parent company Bed Bath & Beyond on Sunday.
The buybuy BABY website and 360 Bed Bath & Beyond locations will remain open as of now. This is because the company has secured a loan for $240 million to fund its operations in bankruptcy.
The company will begin closing down stores on Wednesday as it uses Chapter 11 proceedings to sell itself. The company said that if they are able to find a buyer for the company, it will "pivot" away from closing stores.
Bed Bath & Beyond is likely to be liquidated and close down if a buyer doesn't appear.
Neil Saunders is a retail analyst at GlobalData Retail and the managing director. He said that Bed Bath & Beyond would be a shadow of its former selves' if they emerge from bankruptcy.
Saunders stated that the buybuy BABY part of the business will likely attract buyers' interest.
Saunders stated that the former retail giant may move to an online-only model, but this could mean a'reduced visibility and a more difficult trading system from a profitability perspective'
Bed Bath & Beyond purchased buybuy BABY in 2007 for $67 Million. The chain had eight stores at the time in New York, New Jersey and Maryland. Richard and Jeffrey Feinstein founded the baby and toddler shops in 1996, sons of Bed Bath & Beyond co-founder. The firm bought several stores in the 2000s including Harmon Stores and Christmas Tree Shops. It also acquired buybuy BABY, Cost Plus World Market, and Cost Plus World Market.
Bed Bath & Beyond put some hope in buybuy BABY as it struggled to stay afloat. Ryan Cohen, a former activist investor, stated in a letter dated March 20, 2022 that buybuy BABY is worth more than Bed Bath & Beyond’s entire market cap and should either be spun off or looked for a buyer who would take the entire company private.
Mark Tritton, former CEO of Bed Bath & Beyond, said that the wedding and baby product categories were a bright spot for the company. He noted an increase in sales at the start of 2022.
Tritton, who had been leading the company for only three years, was dismissed last June. He was hired by Bed Bath & Beyond from Target in 2019, where he had been in charge of expanding the private label brands.
Despite this, the company has already closed five Buybuy Baby stores in the past year.
Bed Bath & Beyond filed for bankruptcy in 2009 with $5.2 billion of debt and only $4.4 billion of assets. Bed Bath & Beyond's bankruptcy was attributed to the rise of online shopping, the popularity of Walmart and Target (TGT), and Costco. These companies attracted customers by offering lower prices and more merchandise.
Thank you to our loyal customers. A statement on the website stated that the company had made the difficult choice to wind down its operations.