Bed Bath & Beyond CEO’s turnaround plan may just work
It’s been not quite a year since Mark Tritton started at Bed Bath & Beyond (BBBY) with a plan to turn the struggling retailer around. While it may be too early to declare victory, there is growing evidence that the CEO is checking off his to-do list in quick order.
The most recent example is the sale of the 800-store Christmas Tree Shops chain and a Massachusetts distribution center that supplies those locations. That deal, along with the sale of Linen Holdings, a business that sells supplies to the healthcare and hospitality industries, and another of a distribution center in New Jersey, is expected to generate roughly $250 million for BBBY.
“Today’s announcement builds on the purposeful steps we have made throughout the year to simplify our portfolio, unlock capital and create clear strategic focus to accelerate our plans to build our authority in the Home, Baby, Beauty and Wellness markets,” said Mr. Tritton in a statement. “Customers are responding well to the introduction of our new omni-always services, and we will continue to invest in our digital-first experience with a customer-inspired assortment that makes it easy to feel at home with Bed Bath & Beyond.”
BBBY has certainly been among the retailers that has benefitted as Americans stay at home due to the novel coronavirus pandemic, but it’s also clear that steps put in place under Mr. Tritton have helped, as well.
The retailer posted a six percent gain in same-store sales in the second quarter, the first time it has done so since the first quarter of 2016. BBBY, which has focused on improving its digital operations under Mr. Tritton, achieved an 89 percent gain from the channel, helping to offset a decline of 12 percent in store sales affected by the virus outbreak. It also managed to modestly improve its gross margin during the quarter.
Since assuming the top spot, Mr. Tritton has:
- Established a five pillar strategy for the business focused on product, price, promise, place and people with an immediate concentration on omni-always and creating a differentiated shopping experience in stores;
- Brought in a new executive team to help him lead the company;
- Completed a sale-leaseback deal of stores, a distribution center and offices that netted $250 million;
- Sold PersonalizationMall.com for $252 million;
- Announced and implemented a corporate restructuring plan reducing annual expenses by $85 million;
- Added same-day delivery of online orders with Shipt and Instacart.
- Bed Bath & Beyond Announces Significant Milestone In Plan To Sell Non-Core Assets – Bed Bath & Beyond Inc.
- Bed Bath & Beyond Inc. Reports Results For Fiscal 2020 Second Quarter – Bed Bath & Beyond Inc.
- Bed Bath & Beyond Inc. Announces Extensive Changes To Leadership Team – Bed Bath & Beyond Inc.
- Bed Bath & Beyond’s CEO cleans house – RetailWire
- Will ‘five pillars’ provide the foundation Bed Bath & Beyond needs to succeed? – RetailWire
- Bed Bath & Beyond Inc. Announces Completion Of Sale-Leaseback Transaction Generating Over $250 Million In Net Proceeds – Bed Bath & Beyond Inc.
- Bed Bath & Beyond Inc. Announces Strategic Restructuring Program To Simplify Operations And Reset Cost Structure – Bed Bath & Beyond Inc.
- Bed Bath & Beyond Inc. Announces Agreement To Sell PersonalizationMall.com – Bed Bath & Beyond Inc.
- Will same-day deliveries be a difference maker for Bed Bath & Beyond? – RetailWire
- Bed Bath & Beyond banks on private brands – RetailWire
DISCUSSION QUESTIONS: Are you becoming a Bed Bath & Beyond believer yet? What else are you looking to see that says the retailer has turned the corner and is in a position to grow again? Do you think Mark Tritton has made any moves that he will later regret?