It’s official: Bed Bath & Beyond is winding down its retail operations after filing for Chapter 11 bankruptcy protection in New Jersey this morning.
The company said in a press release that it intends to keep its websites and the remaining 360 Bed Bath & Beyond and 120 buybuy BABY stores open for the time being as it begins liquidation and closure efforts across the entire chain.
“Millions of customers have trusted us through the most important milestones in their lives — from going to college to getting married, settling into a new home to having a baby,” says Sue Gove, President & CEO of Bed Bath & Beyond Inc. “Our teams have worked with incredible purpose to support and strengthen our beloved banners, Bed Bath & Beyond and buybuy BABY. We deeply appreciate our associates, customers, partners, and the communities we serve, and we remain steadfastly determined to serve them throughout this process. We will continue working diligently to maximize value for the benefit of all stakeholders.”
While the impact on the toy industry is minimal compared to those felt during the closures of Toys “R” Us, Kmart, and Sears over the past decade, Bed Bath & Beyond did stock an assortment of toys, mainly sold under its buybuy BABY brand. No toy companies appear within the list of the top 30 unsecured creditors that the company filed with the court this morning.
Source: OntheRun Photo – stock.adobe.com
One notable anomaly for a retail bankruptcy is the sheer amount of marketing-related expenses that emerged in today’s filing. Within the top 30 unsecured creditors, Bed Bath & Beyond owes more than $6 million to Commission Junction for operating its affiliate marketing program; $3.4 million to Facebook; and $2.8 million to Pinterest. On top of that, many of its creditors are service providers supporting in-store signage and POP systems, shipping (more than $3.8 million is owed to FedEx), and communications (nearly $3 million is owed to Verizon).
But the biggest creditor on the list is the Bank of New York Mellon Corporation, best known as BNY Mellon to whom $1.1 billion is owed.
It’s been a tumultuous few years for the once mighty Bed Bath & Beyond as the chain found in a “too little, too late” situation as it struggled to modernize stores, battle activist investors, and deal with a raft of leadership changes. Last summer, Gustavo Arnal, the company’s Chief Financial Officer, died after jumping from his Tribeca apartment. Earlier this month, former CEO Mark Tritton, who joined the company from Target in 2019, sued Bed Bath & Beyond alleging unpaid severance.
In a move that echoed the way former Toys “R” Us leadership took an “it will all be okay” stance during its final days leading up to liquidation, Bed Bath & Beyond planned a special meeting of shareholders for next month, launched a vendor consignment program two weeks ago, and issued a press release just four days ago touting upgrades to its customer registry experience at buybuy BABY.
Parties interested in the case can view the full docket at Kroll. Stores are expected to begin final closing sales beginning this Wednesday.
