Tuesday, May 23, 2023

Bright Sun Films presents 'Bankrupt — Bed Bath & Beyond', a tale of the Retail Apocalypse

It's been one month since Bed Bath & Beyond filed for bankruptcy, which is just enough time for Jake Williams of Bright Sun Films to put together Bankrupt — Bed Bath & Beyond, the tale of the Retail Apocalypse I promised yesterday.

For nearly 50 years, Bed Bath and Beyond was at the top of their game, known across the industry as a "category killer", able to stand up to the largest companies in America like Walmart and Target just by their niche in the market. Millions of deal-hungry shoppers, wedding registries and college young adults shopped here and helped skyrocket the company into massive success with over 1,500 stores. But just as quickly as their rise, the retailer then fell on hard times. In under a decade, the company went from record sales, to bankruptcy and a total collapse of the brand. Join me today as I explore why this happened and document the final moments for a beloved retailer.
Jake's video makes for a good update to Company Man asks 'The Decline of Bed Bath & Beyond...What Happened?' — a tale of the Retail Apocalypse. I'm being a good environmentalist and recycling my reactions from there.
Company Man Mike compiled this list to explain what happened.
When I told my wife that I was writing a blog post about Bed Bath & Beyond, she immediately brought up how their weak online presence hurt them in competition with Amazon based on her personal shopping experience.
Jake went beyond Company Man Mike by pointing out how awful Bed Bad & Beyond's website was. His take on competition was different. Bed Bath & Beyond outlasted its most direct competition, Linens and Things, but wasn't able to survive competing with Amazon and discount brick-and-mortar chains like Walmart and Target, which I mentioned in February.
We haven't been in one of their stores since COVID-19 hit, but we've bought plenty through Amazon. On the other hand, I've gone into the nearest Target if only to pick up online orders, which I did when I had an eventful three days and two nights because of a severe storm knocking out my power, and my wife and I have had a lot of Target orders delivered to our house. Target is beating Bed Bath & Beyond both online and in the store...
And people noticed, enough so that CNBC warned that Bed Bath & Beyond is 'facing extinction' four years ago. CNBC ended up being right.
Returning to Company Man Mike's list, he noted that the problem with the turnaround plan wasn't the plan itself, but management's rushing it in its impatience to get it to work. I think that's a common problem with American businesses, particularly publicly traded ones that are driven by quarterly bottom lines. Speaking of public trading, this is the second time I've seen stock buybacks being a driver of debt since GNC's bankruptcy. I wrote then "I might see stock buybacks as a cause of cash flow problems more often as the pandemic-caused recession continues." That recession ended almost as soon as it began and we may be closer to another recession later this year, but that prediction still came true.
Jake noted how stupid a move that ended up being, as all that stock is now worthless.

I close by recycling the end of the last post on Bed Bath & Beyond.
That's the latest on the Retail Apocalypse. I expect I'll be returning to this topic between now and the end of June. If nothing else, Erik of Retail Archaeology will be covering the shutdown of stores in Arizona and posting videos, which I will share here. Stay tuned.

No comments:

Post a Comment