BED Bath & Beyond is looking at greener pastures ahead as the retailer takes on a new retail space after being acquired by online platform Overstock.com.
Bed Bath & Beyond, a once thriving home goods giant, officially filed for bankruptcy in April.
But just two months later, the store had been acquired for more than $20million by Overstock, which planned to use the chain’s intellectual property to relaunch as an online retailer.
While all Bed Bath & Beyond storefronts are slated for closure, Overstock’s chief executive officer Jonathan Johnson said the brand’s future is on solid footing.
The newly relaunched website greets shoppers with, “Welcome to a bigger, better beyond.”
Several deals are already advertised on the site, including 15 percent to 20 percent off bedding and bath products as well as some furniture.
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“Since this deal was announced, we have added over 600,000 new products to the site,” Johnson said.
“Simply put, knowing we will be operating as Bed Bath & Beyond has made us more attractive to supplier partners,” Johnson told analysts previously.
With the new IP acquisition underway, Overstock is adding on additional suppliers and increasing the products available on its website.
“The merchandising team is clearly seeing the tailwind from attaching our business model to the well-known and much-loved Bed Bath & Beyond brand name that ranks much higher than the Overstock brand name in its association with home,” Johnson said in a July earnings call.
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Previously, Overstock and Bed Bath & Beyond shared around 80 percent of the same vendor base, but some vendors had stayed away from the online-focused brand before it had Bed Bath & Beyond’s name.
“In the past some of our partners have not offered us their entire catalog of these branded home products,” Johnson said. “That is now changing in a meaningful way.”
Since the acquisition, stock keeping units grew by 600,000 in just a month.
Since Overstock had previously been losing sales, the changes are a promising reflection of the company’s future growth.
Overstock’s revenue had declined by 20 percent in the second quarter alone, and the company also suffered from a $4million operating loss.
According to Neil Saunders, managing director with GlobalData, Overstock had “fallen off the consumer radar somewhat and is not drawing in customers, even to browse, like it used to,” according to Retail Dive.
Because Bed Bath & Beyond is a “much more powerful, much better-known brand,” Overstock likely has a chance to turn things around, the analyst said.
This echoes Johnson’s comments about the future of the brand as well.
“Over time, we will sunset the Overstock logo and brand. Customers and suppliers like the Bed Bath & Beyond brand,” Johnson said. “So do we. That is who we are becoming.”’
OTHER RETAIL CLOSURES
Bed Bath & Beyond is far from the only brand that found itself in financial trouble and closing stores amid changing market dynamics.
Party City also filed for Chapter 11 bankruptcy and will be closing more than 30 locations this year.
Its financial woes were preceded by a perfect storm of factors.
Back in 2019, the chain suffered a helium shortage, which saw 45 stores shutter as a result.
And once the coronavirus pandemic hit in 2020, shoppers stopped holding parties altogether, severely disrupting the company’s business model that once thrived off in person events.
Meanwhile pharmacy giant CVS is also feeling the financial hit to its brick and mortar stores.
CVS said it plans to shutter at least 300 stores per year through 2026.
Likewise, CVS's rival Walgreens closed multiple stores this summer.
This includes one in Syracuse, New York, and another in Dundalk, Maryland.
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A major bridal retailer is also closing up shop at several locations across the country after a bankruptcy filing.
And a major bank with nearly 3,000 locations also has plans to shutter 29 branches this month.
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