After 15 years of Bed Bath & Beyond (BB&B), Canadians will have to start looking elsewhere for avocado slicers, onion choppers, and any other bizarre kitchen gadgets under the sun.
What happened: BB&B is shuttering its Canadian stores, closing all 54 locations across the country, as part of a broader attempt to stave off bankruptcy and save its American business.
Catch-up: While teetering on the verge of bankruptcy, the big box store pioneer managed to secure an equity investment led by Hudson Bay Capital Management (a hedge fund) worth up to US$1.25 billion while rolling out cost-cutting plans, like closing underperforming stores.
- BB&B Canada reported a net loss of CA$99.5 million over nine months last year, so it's likely that Canadian stores were among those underperformers.
By the late 2010s, BB&B was lagging behind competitors on the e-commerce front. In 2019, a new CEO was tasked with righting the ship by focusing on private label brands, investing in tech, and revamping stores, including nixing the signature cluttered ceiling-high displays.
Unfortunately, the plan took effect just as Covid was saying its first hellos. When stores reopened after lockdowns, shoppers were confused by the new layout and disappointed that many name-brand goods they had come to expect were no longer there.
- Plus, BB&B had a tough time actually stocking stores, as its shift to private-label goods meant it was more sensitive to pandemic-induced supply chain bottlenecks.
Bottom line: Retail is going through a rough patch as consumers shift spending habits, but BB&B represents the worst-case scenario. It’s a cautionary tale of being late to innovation and, when finally changing things, forgetting what customers actually like about your store.