TEXAS – As part of its restructuring and resource reallocation strategies, Bed Bath & Beyond has initiated the closure of 150 stores in the United States, including locations in El Paso, Texas and Las Cruces, New Mexico.
Sue Gove, president and CEO of Bed Bath & Beyond Inc, said that early in the third quarter, a turnaround plan focused on serving customers was initiated after a period in which merchandise and strategy had deviated from their preferences.
“While we acted quickly and effectively to change assortment and other merchandising and marketing strategies, inventory was limited and we fell short of our targets. We will continue to rebalance our assortment toward national brands and refine our own-brand mix to reflect our deep understanding of our customers,” he said.
“We are implementing our plan with alacrity, while managing our financial situation in a changing environment. We are delivering on our aggressive second-half commitment of $250 million in selling, general and administrative expense optimization, or $500 million in annualized savings. We are also on track to close the 150 stores we had announced, which will allow us to allocate resources based on customer demand,” he added.
Since February 7, the company began closing stores, as explained in a press release, which includes a complete list of the stores that will permanently close, including the one located at 1327 George Dieter Drive in El Paso, as well as the store located at 2200 East Lohman Avenue in Las Cruces, New Mexico.
According to its most recent financial report, during the third quarter of 2022, the company’s net sales of $1.259 billion decreased 33%, driven primarily by a decline in comparable sales.
Bed Bath & Beyond comparable sales declined 34%. Selling, general and administrative expenses were $583.6 million, significantly below last year’s $698 million, driven by the successful execution of aggressive cost reduction initiatives.
As part of strategies to achieve approximately $250 million of savings in selling, general and administrative expenses or $500 million on an annualized basis, incremental cost reductions of approximately $80 million to $100 million were also initiated across the company, including overhead and headcount, to align with the current business.
The company also reported that an additional $80 million to $100 million savings opportunity has been identified in the supply chain that will also improve the cost of service and delivery time to our customers.
The net loss for the quarter included $100.7 million of non-cash impairment charges related to certain store assets. Cash flow from operations was approximately US$307.6 million.