New leadership at Bed Bath & Beyond kicks off a new transformation strategy
Behind the numbers in Bed Bath & Beyond’s unfortunate Q1 results were some more dismal figures for key product categories. During this morning’s investor call, executives said sales in the bedding, bath and kitchen categories declined by double digits over March, April and May. Those three segments account for roughly 50% of the Bed Bath & Beyond chain’s revenue.
“We have a lot to do, and we must do it quickly.”
Newly appointed interim CEO Sue Gove said she is concentrating on near-term priorities. They include:
Focusing resources on driving traffic to stores and digital platforms
Rethinking how Bed Bath & Beyond is serving customers in order to win back market share
Stabilizing the company’s supply chain, reducing costs and strengthening the balance sheet.
“I believe a lot of this work is best done in a back-to-basics mantra that prioritizes knowing our customer and delivering the experience they deserve wherever they interact with us,” Gove said. “We have a lot to do, and we must do it quickly.”
The company has retained retail advisory firm Berkeley Research Group (BRG) to focus on cash, balance sheet and inventory optimization.
Quarter-to-date comps as far in Q2 are trending in the negative 20’s. For the first quarter ended May 28, comp sales were down 23% on a consolidated basis and down 27% at Bed Bath & Beyond. This followed a difficult Q4, during which Bed Bath & Beyond’s comps tumbled in all five of its destination product categories.
The company expects to see some comp improvement in the second half of the year as it optimizes inventory, including with incremental clearance activity.
Executives emphasized that the nameplate plans to remain suitably stocked for the Back-to-College and Q4 holiday seasons.
Harriet Edelman, independent chair of the Bed Bath & Beyond Inc. board of directors, told investors that while the macro environment right now presents a number of challenges, the company recognizes that it needs to make impactful changes to improve results.
“We should be achieving so much more,” she said.