Bed Bath and Beyond will be closing over 200 stores due to the coronavirus (COVID-19) pandemic. The company made the big announcement on Wednesday (July 8).
Online Vs. In-Store
Although numerous stores will be closing their doors, their online business has been booming due to the need for cleaning supplies. Their internet business has reportedly increased by 100%. Two-thirds of the total income from the first quarter is from online sales.
Comparatively, the brick and mortar stores’ sales have decreased by 50%, The Daily Mail reported. The shutdowns of the select stores are set to save the company $250-350 million overall.
After the closing of the stores was announced, the company’s stock fell more than 6 percent during after-hours trading. CNBC reported that the company’s “net loss narrowed to $302.29 million, or $2.44 per share, from $371.09 million, or $2.91 a share, a year ago.”
Along with Bed Bath and Beyond, the company also owns buybuy Baby, Christmas Tree Shops and Harmon Face Values. The company owned 1,478 stores, 955 of those being Bed Bath and Beyond shops.
What the Company Says
“We saw there were a number of stores dragging us down,” Chief Executive Mark Tritton told CNBC. “We will continue to look at the rest of our concept doors, now that we have established the data criteria.”
As for the boom in online sales, especially home decor and sanitizing products, the surge won’t be ending for a while. “Home is now everything,” Tritton added. “It’s the epicenter.”
According to Tritton, as Bed Bath’s stores are reopening, many are performing ahead of the retailer’s internal expectations. Consumers during the pandemic have shifted from stocking up on cleaning supplies, water filters and coffee, to bigger-ticket items like home decor, bedding and accessories for the backyard, he said. This trend also should help profit margins, he said.
Overall, the company told the outlet that they are in a “strong financial position” to weather the pandemic. Even though they believe that they will make it through these uncertain times, they will not provide a 2020 outlook at this time as the world “remains volatile.”
H / T CNBC
