Bed Bath & Beyond plans to shut 200 stores in two years
July 10, 2020 - United States Of America
Bed Bath & Beyond, a US-based omnichannel retailer, has announced that as part of extensive business transformation underway, it continues to drive strong actions. In order to execute this restructuring programme company plans to right-size its real estate portfolio by closing nearly 200 stores over the next two years and focus on SG&A expense reductions.
Bed Bath & Beyond expects the aggregate benefit from these actions will generate future annualised savings of between $250 and $350 million, excluding related one-time costs, the company said in its results for first quarter of fiscal 2020.
“The impact of the Covid-19 situation was felt across our business during our fiscal first quarter, including loss of sales due to temporary store closures and margin pressure from the substantial channel shift to digital. From the beginning of this crisis, we have taken measured, purposeful steps to help keep our people safe and our customers serviced, and we are proud of the way our teams have navigated this unprecedented challenge with speed and agility,” Mark Tritton, Bed Bath & Beyond's president and CEO said.
During Q1 FY20, the company took decisive action to proactively manage the unprecedented financial and operational impacts of Covid-19, while prioritising the investments designed to rebuild and grow the business. In prioritising investments such as the accelerated launch of BOPIS and Curbside Pickup services, the company rapidly evolved to meet the changing needs of its customers during this time, the company said.
In its first quarter FY20, Bed Bath & Beyond reported 49 per cent sales decline to $1.3 billion compared to sales of $2.5 billion in same period last year. However, digital channels for the quarter ended on May 30, 2020, grew 82 per cent, including growth in excess of 100 per cent during April and May. Whereas sales from stores, of which 90 per cent of the company's total fleet were closed during the majority of the quarter, dropped 77 per cent.