April 23, 2023
Bed Bath & Beyond filed for Chapter 11 bankruptcy protection on Sunday, after failed attempts to raise enough money to keep the company up and running.
The home goods retailer, which has its headquarters in Union, New Jersey, will keep its 360 namesake stores and 120 Buybuy Baby locations open for now as the company begins to close the business and liquidate assets, according to a press release. The company also filed motions in New Jersey bankruptcy court asking permission to auction the Bed Bath & Beyond and Buybuy Baby brands.
"Millions of customers have trusted us through the most important milestones in their lives – from going to college to getting married, settling into a new home to having a baby," Sue Gove, president and CEO of Bed Bath & Beyond Inc., said in a statement. "We deeply appreciate our associates, customers, partners, and the communities we serve, and we remain steadfastly determined to serve them throughout this process."
Bed Bath & Beyond, which was founded in 1971, has been warning of a potential bankruptcy since January, when the company issued a “going concern” notice that it may not be able to cover expenses after a bleak holiday season.
As of last November, Bed Bath & Beyond had about $4.4 billion in assets and $5.2 billion in debts, CNBC reported. Along with owing money to many creditors, including vendors like Pinterest and Keurig, the company owes the most to corporate investment banking company BNY Mellon at a whopping $1.18 billion, according to court documents. The company's stock has also plummeted, and is down about 88 percent this year.
Investment company Sixth Street agreed to lend the company $240 million in debtor-in-possession financing so the company can have the necessary funds to support operations through the bankruptcy process, such as honoring employees wages and benefits as well as its obligations to vendors. Bad Bath & Beyond has between 25,001 and 50,000 total creditors and employs about 14,000 non-seasonal workers, according to court filings.
The company said that it expects all stores to close by June 30. Bed Bath & Beyond will stop accepting coupons on Wednesday, instead planning to offer discounts during going-out-of-business sales.
Bed Bath & Beyond will stop accepting gift cards on May 8, and the store's Welcome Rewards points will stop being accepted on May 15. Starting Sunday, Bed Bath & Beyond also will no longer award points to customers for purchases. Merchandise purchased before Wednesday can be returned until May 24, and all sales after Wednesday will be final.
Bed Bath & Beyond has engaged in several failed last-ditch efforts to save the company, including securing stock offerings to bring in funds and partnering with a liquidator to boost inventory. Unfortunately, the company struggled to maintain relationships with vendors and continued to face low inventory, dwindling sales and diminishing cash, so efforts to save the retailer proved futile.
The past few years have been generally turbulent for retailers forced to adapt to shifts in the post-pandemic retail landscape. While consumers rushed to spend the stimulus money in their bank accounts during the pandemic, shoppers are now cutting back and are more discerning in spending.
David's Bridal, a Montgomery County-based chain, was recently forced to begin laying off more than 9,000 workers ahead of a potential sale.
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