According to the Wall Street Journal (WSJ), the retailer filed for Chapter 11 bankruptcy in Newark, New Jersey on April 23. The company said it expects to eventually close all of its 360 BBB and 120 Buybuy Baby locations across the country. It added that Sixth Street Partners, its top lender, has put up $240 million in financing to keep BBB operational through the liquidation process.
"Bankruptcy gives BBB the breathing room to conduct going-out-of-business sales at its physical stores and solicit interest from potential buyers for its remaining assets, such as its branding," the WSJ noted. "Individual investors who continued to back Bed Bath & Beyond during its final months … will likely be wiped out in Chapter 11, which prioritizes the repayment of debt over shareholder recoveries."
With the April 23 filing, BBB joins a growing list of retailers seeking court protections. David's Bridal LLC recently filed for bankruptcy once more, its second time in five years. It warned that it would permanently close all of its stores if it fails to quickly find a buyer.
J.C. Penney Co. filed for bankruptcy in Texas in May 2020, although it continues to operate hundreds of stores. Meanwhile, Sears and Toys 'R' Us have closed most of their locations.
BBB Chief Financial Officer Holly Etlin expressed optimism about the company finding a buyer. She stated in the court filing: "BBB has pulled off long-shot transactions several times over the past six months, so nobody should think BBB should not be able to do so again." (Related: Bed Bath & Beyond files for Chapter 11 "reorganization" bankruptcy following shady board moves and corporate virtue signaling.)
First established as Bed 'n Bath in 1971, the company changed its name to the current iteration in 1987. The company went public five years later in 1992, acquiring several smaller stores. According to WSJ, the company did not have an unprofitable year prior to 2019 – when its financial woes began.
Under the leadership of former CEO Mark Tritton, the retailer dropped name brands it carried on store shelves in favor of private-label goods made exclusively for BBB. But former employees and analysts pointed out why Tritton's plan failed – which eventually led to his departure in June 2022.
First, the switch came at a time when the Wuhan coronavirus (COVID-19) pandemic disrupted supply chains. Factories had temporarily closed and shipping delays had been piling up, alongside rising costs. This made it difficult for retailers, including BBB itself, to keep store shelves stocked.
Second, BBB also rolled out too many private brands too quickly before it had the infrastructure to support them. According to the former employees, the retailer planned to launch eight new brands in 2021 alone.
Third, the retailer capitalized on the demand from consumers stocking up while sheltering from the pandemic. The initial gains quickly evaporated as demand ebbed, with sales falling and losses piling up by August 2021.
Most notable, however, is BBB's pivot toward wokeism by dropping MyPillow from its stores. Back in January 2021, the retailer announced that it would no longer carry the brand in its locations. The decision stemmed from Lindell's skepticism toward the 2020 presidential election that put President Joe Biden in the White House.
The Gateway Pundit reported that a year after dropping MyPillow, BBB announced the closure of 37 stores. The company's results for the third quarter of 2021 revealed that a "lack of inventory" cost them $100 million.
Wells Fargo analyst Zachary Fadem noted that BBB's fundamentals are "deteriorating" amid "choppy execution" by management. Meanwhile, Tritton said supply chain headwinds will persist in the near term – putting a damper on future results.
"They could have stocked their shelves with MyPillow products, but they decided to get political," the Gateway Pundit wrote. "Fortunately, Mike doesn't need retailers like BBB – he's going direct to conservatives and passing on the savings."
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Watch this video about BBB's shift to wokeism and its subsequent downfall.
This video is from the mcr channel on Brighteon.com.