One Bed bath & bust scenario One expert warned it could bring some short-term financial damage to rival home-furnishing retailers amid a nationwide ramp-up in clearance sales.
“In short, the liquidation [would be] It’s a little rough with JC Penney, Kohl’s, Target, Walmart, Wayfair and maybe the Container Store – and to some extent maybe Macy’s – because someone like [liquidator] Gordon Brothers is going for a really massive liquidation,” retail expert Jan Rogers Kniffen told Yahoo Finance.
Potential for Bed Bath & Beyond (BBBY) going bankrupt in 2023 seems high.
Outdoor shower bed said Thursday That bankruptcy is under consideration as it tries to shore up a leaked balance sheet after a disastrous holiday shopping season.
The Company continues to consider all strategic alternatives including restructuring or refinancing its debt, seeking more debt or equity, reducing or delaying business operations. and the Company’s strategic initiatives, or asset sales, other strategic transactions and/or other actions, including applying for relief under the United States Bankruptcy Code,” Bed Bath & Beyond said in a statement.
“These measures may not be successful,” the company added, noting that there is “substantial doubt” about its ability to continue to be an “ongoing concern.”
For the third fiscal quarter ended November 26, 2022, revenue fell more than 30%, to $1.259 billion from $1.878 billion in the same period last year. The company said those numbers reflect “lower customer traffic and reduced inventory availability, among other factors.”
Bed Bath & Beyond is expected to report a net loss of $385.8 million for the quarter.
Meanwhile, the retailer’s stock fell nearly 30% in Thursday trading and then another 22% on Friday, sending the stock at an all-time low. since 1992.
Bankruptcy experts don’t rule out filings from Bed Bath & Beyond happening this month.
“I think it’s inevitable for them to apply,” Macco CEO Drew McManigle said on Yahoo Finance Live. “I wouldn’t be surprised to see them file as early as this weekend. There’s no reason not to. I suspect they’re working with their debtor on ownership financing.”
When asked about possible bankruptcy, a spokesperson for Bed Bath & Beyond Julie Strider told Yahoo Finance: “Since the beginning of Bed Bath & Beyond Inc.’s comprehensive turnaround plan early in the third quarter, including financial actions to improve our balance sheet and cash flow, We have worked with strategic advisors to evaluate all avenues to regain market share and improve liquidity, our stated priorities. including restructuring or refinancing our debt, seeking more debt or equity, reducing or delaying the Company’s strategic initiatives and businesses, or selling assets, other strategic trades and/or other measures. No decisions have been made at this time.”
In any case, Kniffen ultimately believes that Bed Bath & Beyond’s competitors will bounce back quickly from any large-scale shutdown sales.
The reason for that, Kniffen explains, is because Bed Bath & Beyond has been largely out of favor in shoppers’ minds for years due to merchandise fulfillment issues.
Kniffen added: “Six months later, those players will see some slight increase in market share. “But this company has been losing market share for twenty years now. I don’t see how there really are any winners worth calling for. It can’t pass the needle on anyone. Some market share also doesn’t work. will be shipped online to Amazon, of course.”