With the shelves bare and coupons almost useless, Bed Bath & Beyond finally succumbed to what industry experts say was a long time coming. On Sunday, the housewares chain filed for Chapter 11 bankruptcy protection and announced it would close all its stores, shedding thousands of workers.
“This company has been in late-stage decline for a while,” said Ted Gavin, managing partner and founder of corporate restructuring firm Gavin/Solmonese. “The fact that it lasted as long as it did is the big surprise.”
The Union, N.J.-based retailer had tried to stave off the inevitable for months. In early January, it posted a $393 million loss for the quarter ended Nov. 26, pushing its fiscal year-to-date losses to more than $1.1 billion. Over the next few weeks, the company said it didn’t have enough cash to repay loans. It also missed interest payments.
In February, after it failed to secure a loan, Bed Bath & Beyond was able to put off a bankruptcy filing when it struck a $1 billion share-sale deal with hedge fund Hudson Bay Capital Management and other investors. But the plan fell apart last month when Bed Bath & Beyond disclosed that it expected comparable store sales to plunge 40 to 50 percent year-over-year in the fourth quarter.
Now that the longtime brand for milestone shopping — college, marriage, babies — is on track to close forever, here’s what it means for consumers.