The latest brick-and-mortar retail chain struggling to attract customers to its many locations is Bed Bath & Beyond. Now, in re-organization efforts, the home goods seller said that while it plans to open 15 brand-new locations this year, at least 40 of its retail shops will be closed down.
According to CNN, Bed Bath & Beyond, who lost money last quarter, revealed earlier in the week that sales are still on the decline. There are currently 1,024 retail stores in the U.S., Puerto Rico, Canada, and Mexico.
Besides the 40 stores that will definitely be closing down, a list of which has not yet been made public, more stores may be shuttered if executives from the New Jersey-based company cannot negotiate better lease terms for several of its locations.
What is doing good for the company, though, is the 21 “next-generation lab stores” that were opened in 2018. During an investors call, CEO Steven Temares praised the new store model and said that some of the innovative ideas presented in these stores that work best will be implemented in other locations in the U.S. Over the last four weeks alone, these shops have done 2.2 percent better than Bed Bath & Beyond’s traditional stores.
These shops have a different layout, making it more visually appealing and easier for customers to see the merchandise, and there is “a greater emphasis on home décor, food and beverage, and health and beauty care,” Temares explained.
CNN reported that three activist funds now have about a 5 percent stake in the company as of last month, and a new corporate governance structure, with a new lead director, will soon be put in place. The group also wants to improve sales by selling more Bed Bath & Beyond-branded items, trimming the product selection, and making the in-store experience more customer friendly.
Jim Cramer, the host of CNBC‘s Mad Money, also believes that leadership at the company needs an overhaul.
“The company still has a good balance sheet, $1 billion in cash, so I think it can be saved. But I gotta tell you something: not with this management team,” he stated.
Cramer also noted that Bed Bath & Beyond is hoping to entice customers by having them enroll in a $29 loyalty program that gives them 20 percent discounts and free shipping on internet orders.
Meanwhile, citing data from Coresight Research, USA Today reported that more than 6,500 retail stores are expected to close in 2019. Charlotte Russe, Gymboree, JC Penney, Payless ShoeSource, Shopko, and Victoria’s Secret are among the retailers closing down multiple locations.