Bed Bath & Beyond was not the best place to shop

The Bed Bath and Beyond Meme Stock Phenomenon: Recent Challenges and Efforts After Cohen’s Decay

The company was hit hard during the pandemic, closing stores temporarily during 2020 while rivals remained open. Sales dropped in both 2020 and 2021.

In the last few years, Bed Bath & Beyond has suffered a number of crises, including a rise and crash as a meme stock, a leadership shake-up, trouble with suppliers, and the shocking news of its financial chief’s death.

Bed Bath said it expects to report a sales decline of 33% compared to last year for the third quarter that ended on Black Friday due to lower customer traffic and reduced inventory availability. The forecast projected losses to increase by more than 40%.

When Ryan Cohen took a stake in Bed Bath and Beyond last year, shares went up as much as 400%, making them part of the meme stock phenomenon.

Late summer, the company had secured financing that propelled it through the holiday shopping season. Now the retailer is trying to refinance its debts, facing waning enthusiasm from creditors.

That includes last week’s announcement that it was also closing all 49 remaining Harmon Face Value stores, which sold cosmetics; plus 5 buybuy Baby locations. A list of the new store closures wasn’t immediately available.

The filing said that the home goods chain expects first quarter sales to be down by 30% to 40% with a subsequent improvement thereafter.

The company was able to avoid insolvency by completing a stock offering that will provide an immediate injection of funds and a pledge for more money in the future.

Bed Bath & Beyond, a Californian Iconoclast and a Model Store for Designer Beuth and Accessory

The company changed its name to Bed Bath & Beyond in 1987 to reflect larger stores. The company went public in 1992 with 38 stores and around $200 million in sales.

Bed Bath & Beyond has gained customers due to the fact that Walmart, Target and Costco have grown in size over the past decade. Discount chains such as HomeGoods and TJ Maxx and have also undercut Bed Bath & Beyond’s prices.

Daniel Gielchinsky is an attorney at DGIM Law that specializes in bankruptcies and reorganizations. The company should slow the cash burn and pivot into a profitable position during the next 6 to 12 months.

Bed Bath & Beyond was a popular store during the winter season, as well as during the back-to-school and college seasons.

Founded in 1971 by two veterans of discount retail in Springfield, New Jersey, the chain of small linen and bath stores — then called Bed ‘n Bath — first grew around the northeast and in California selling designer bedding, a new trend at the time. Unlike department stores, it didn’t rely on sales events to draw customers.

According to a report in 1993, co- founder Leonard Feinstein said that they witnessed the department store shakeout, and knew it was going to be the next wave of retailing. It was the beginning of the designer approach to linens and accessories, and we saw a real window of opportunity.

The company was an example of an iconoclast. It spent little on advertising, relying instead on print coupons distributed in weekly newspapers to attract customers.

The chain was known for giving autonomy to store managers to decide which products to stock, allowing them to customize their individual stores, and for shipping products directly to stores instead of a central warehouse.

Customers who were loyal to big brands were hurt by the change. The company fell behind on payments and stores didn’t have enough inventory to stock shelves. Tritton left as CEO in 2022.