A major retailer had high hopes that recent sales might lead to a turnaround. Sadly, that didn’t happen.
Bed Bath & Beyond warned on Tuesday that more layoffs and store closures may loom after a disappointing third quarter on top of their ongoing struggle to attract and retain customers.
For the period ending Nov. 26, net sales dropped by one-third to $1.26 billion from $1.88 billion one year ago. Sales failed to keep pace with expectations, projected at $1.43 billion for the quarter, according to The Associated Press.
Bed Bath & Beyond was already engaged in cost-cutting, but on Tuesday announced the retailer will cut an additional $80 to $100 million, which is expected to include layoffs company-wide, according to the AP. The number of layoffs was not specified.
The AP reported that Bed Bath & Beyond is also burning through cash. The company reported that it had about $153 million in cash and cash equivalents in the latest quarter, a huge drop from $509 million at the same time last year.
In a news release Tuesday, President and CEO of Bed Bath & Beyond Inc. Sue Gove said the company had expected a turnaround in the third quarter, but that didn’t happen.
“At the beginning of the third quarter, we initiated a turnaround plan anchored on serving our loyal customers, following a period when our merchandise and strategy had veered away from their preferences. Although we moved quickly and effectively to change the assortment and other merchandising and marketing strategies, inventory was constrained and we did not achieve our goals,” said Gove in the news release.
The previously planned closure of 150 stores remains on track, Gove said.
Bed Bath & Beyond released a list of the stores closing, including stores in Arizona, California, Connecticut, Florida, Ohio, North Carolina, and many more. A partial list of 56 stores was previously released in September.
Last week, executives warned they may need to sell assets or seek bankruptcy protection.
“For decades, Bed Bath & Beyond has set the pace across the sector and we have commanded our position in retail through many different economic cycles and alongside a continuously evolving customer. We believe our concrete advantages in defining categories, offering broad and curated selections, and delivering for customers are compelling reasons why we will continue to command a formidable presence in the Home and Baby categories into the future,” said Gove in the news release.
In August, Bed Bath & Beyond announced it would close stores and lay off workers in order to turn the business around. At the time, they said they would need to close 150 stores and cut their workforce by 20%, according to the AP.
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