Bed Bath & Beyond files bankruptcy. All stores to close, including Apple Valley

Bed Bath & Beyond filed for bankruptcy on Sunday, which means closing all U.S. locations, including the store in Apple Valley.

The big box retailer filed for Chapter 11 bankruptcy protection with a U.S. District Court in New Jersey and will permanently close 360 nationwide locations, including 41 in California.

Bed Bath & Beyond, and the 120 Buy Buy Baby locations, will be shuttered by June 30.

The closure of Bed Bath & Beyond follows years of dismal sales and losses, store closures, and numerous failed turnaround plans.

In 2020, the Apple Valley store near Best Buy in the Jess Ranch Marketplace on Bear Valley Road was spared from the chopping block when the company announced the closing of 200 stores over two years. That year, the currently shuttered Bed Bath & Beyond on Amargosa Road in Victorville was one of nearly 63 stores the home goods retailer said they had planned to close.

Bed Bath & Beyond expects to process returns and exchanges under its standard policies until May 24 for items purchased before Sunday.

It also anticipates gift cards, gift certificates, and loyalty certificates will be accepted through May 8. It will stop accepting coupons on Wednesday.

Other California Bed Bath & Beyond locations that will close this year include stores in:

• Bakersfield

• Beaumont

• Canoga Park

• Capitola

• Daly City

• Downey

• Hacienda Crossings

• Eureka

• Fresno

• Goleta

• La Quinta

• Hollywood

• Los Angeles

• Mission Viejo

• Modesto

• Murrieta

• Oakland

• Oceanside

• Palm Springs

• Pasadena

• Pleasant Hill

• Rancho Cucamonga

• Redlands

• Redwood City

• Riverside

• Roseville

• Sacramento I

• Sacramento II

• San Diego

• San Francisco

• San Luis Obispo

• Santa Ana

• Santa Clara

• Santa Rosa

• Seal Beach

• Studio City

• Thousand Oaks

• Torrance

• Vacaville

• Ventura

• Yorba Linda

‘Orderly wind down’

The chain said it would start an orderly wind-down of its operations while seeking a buyer for all or some of its businesses, the Associated Press reported.

The retailer listed estimated assets and liabilities from $1 billion to $10 billion. The move comes after the company failed to secure funds to stay afloat.

In a statement, company officials said it voluntarily filed “to implement an orderly wind-down of its businesses while conducting a limited marketing process to solicit interest in one or more sales of some or all of its assets.”

Job at risk

The store closings will put thousands of jobs at risk. The company employed 14,000 workers, according to the court filing. That’s drastically down from the 32,000 as of February 2022.

Bed Bath & Beyond said it secured a commitment of roughly $240 million in financing from Sixth Street Specialty Lending, Inc. to allow it to keep operating during the bankruptcy process.

“It’s the death of an icon. A lot of people have grown up with it, ” said Neil Saunders, managing director of GlobalData Retail. “It’s an institution in retailing, but unfortunately, being an institution doesn’t protect you from financial woes.”

Founded in 1971, Bed Bath & Beyond had enjoyed its status as a big box retailer offering a vast selection of sheets, towels, and gadgets unmatched by department store rivals.

It was among the first to introduce shoppers to many of today’s household items like the air fryer or single-serve coffee maker, and its 15% to 20% coupons were ubiquitous.

But over the last decade, Bed Bath & Beyond struggled with weak sales, mainly because of its messy assortments and lagging online strategy, making it hard to compete with Target and Walmart.

In late 2019, Bed Bath & Beyond tapped Target executive Mark Tritton to take the helm and turn around sales. Tritton quickly reduced coupons and started introducing store label brands at the expense of national labels, a disastrous strategy for the retailer.

And the pandemic, which happened shortly after Tritton’s arrival, forced the retailer to close its stores temporarily.

Analysts said it was never able to use the health crisis to pivot to a successful online strategy as others had. And while many retailers were grappling with supply chain issues a year ago, Bed Bath was among the most vulnerable, missing many of its 200 best-selling items, including kitchen appliances and personal electronics, during the holiday 2021 season.

After two back-to-back quarters of disastrous sales, the retailer ousted Tritton in June 2022. In recent months, the company, under the stewardship of recently appointed president and CEO Sue Grove, returned to its original strategy of focusing on national brands instead of pushing its store labels.

But the company has had a hard time having suppliers commit to delivering merchandise because of the retailer’s financial woes.

This past holiday season, the stores were missing many essential items and lost many customers, a problem that continued to plague the retailer through the winter and spring seasons.

The bankruptcy filing comes as the company’s shares have tumbled even more as speculation of an impending bankruptcy filing increased. Its financial performance has also deteriorated. In late March, it noted that preliminary results showed anywhere from a 40% to 50% decline in sales at stores opened at least a year for the quarter that ended Feb. 25.

The company also said in a Securities and Exchange Commission filing in late March that it planned to sell $300 million worth of shares to avoid a bankruptcy filing.

More challenges to come?

The home goods retailer had issued several warnings about a potential bankruptcy filing since early this year.

In late January, it noted in a government filing it was in default on its loans and didn’t have the funds to repay what it owed. The company had said the default is forcing it to look at various alternatives, including restructuring its debt in bankruptcy court.

Bed Bath & Beyond joins a growing list of retailers that have filed for bankruptcy this year, including party supplies chain Party City and David’s Bridal. The default could offer a window into what’s to come in the retail industry, given the changing landscape and the increasing challenges in the U.S. economy.

Many retailers filed for Chapter 11 bankruptcy during the pandemic, including Neiman Marcus and J.C. Penney. But in 2022, there was a respite in retail bankruptcy filings as shoppers, flush with government stimulus money and a pile of savings, spent with abandon, helping to lift all retailers.

But as credit tightens and inflation remains stubborn, shoppers have tightened their purse strings in recent months, leaving struggling retailers like Bed Bath & Beyond more vulnerable.

Bed Bath & Beyond had been trying to turn around its business and slash costs after the previous management’s new strategies worsened a sales slump.

The company announced last August it would close about 150 of its namesake stores and slash its workforce by 20%. It also lined up more than $500 million of new financing.

Bed Bath & Beyond’s shares, trading at distressed levels, have also been on a turbulent run. It ran from $5.77 to $23.08 over two weeks in August. The trading was reminiscent of last year’s meme-stock craze when out-of-favor companies suddenly became darlings of smaller-pocketed investors.

But the stock fell back to Earth after Ryan Cohen, the billionaire co-founder of online pet-products retailer Chewy Inc. who purchased a nearly 10% stake in Bed Bath & Beyond last March, sold off all his shares.

Shares were hovering close to 30 cents in the past few days. A year ago, shares were trading at around $17.

The Associated Press contributed to this story.

Daily Press reporter Rene Ray De La Cruz may be reached at 760-951-6227 or RDeLaCruz@VVDailyPress.com. Follow him on Twitter @DP_ReneDeLaCruz.

This article originally appeared on Victorville Daily Press: Bed Bath & Beyond files for bankruptcy. All U.S. locations to close