While Bed Bath & Beyond Inc. executives insisting the troubled retailer has a brighter future, many engaged couples have already issued their verdict: They don’t think the company will survive.
Since January, several thousand couples have removed Bed Bath & Beyond items from their registries for upcoming weddings on Zola Inc., an online wedding services platform. That’s a drop of more than 50% from wedding registrations held last year.
Bed Bath & Beyond already has revealed that total turnover has fallen sharply in recent quarters. But the exodus of so many married couples-to-be underscores that the precipitous decline is not a temporary slump that will easily reverse if the retailer can replenish stocks of goods. The Bed Bath & Beyond brand has gone deep damaged through months of financial turmoil and warnings from a possible bankruptcycausing many customers to give up on the retailer altogether.
By removing Bed Bath & Beyond items from their registries, engaged couples are signaling that they have doubts that Bed Bath & Beyond will be around when they eventually get married — or at least they’re signaling that they don’t want to go into business. do with a retailer they suspect will continue to have problems for the foreseeable future.
In a statement, a spokeswoman for Bed Bath & Beyond said the company remains “steadfast” in driving the turnaround.
“We are taking steps to support and grow our business, including starting a $120 million supplier program to build inventory,” she said. “At this critical time in our journey, many customers support us, and we appreciate every customer who chooses Bed Bath and Beyond.”
‘Necessary steps’
Since January, about 200 couples have emailed Zola customer service to ensure that Bed Bath & Beyond items they listed on their online marriage registries were properly removed. Thousands of other couples simply removed Bed Bath & Beyond items themselves without the intervention of Zola’s customer service. Zola says the drop is likely related to the retailer’s financial problems. Since its inception in 2013, more than 2 million couples have used the registry website.
shopping public bearishness about Bed Bath & Beyond’s prospects contrasts sharply with executives’ outspoken optimism about how their recovery efforts are progressing.
“We are taking the necessary steps as part of our financial strategy to support and grow our business,” said Chief Executive Officer Sue Gove on April 10.
Many families continue to visit Bed Bath & Beyond and its Buybuy Baby brands “to find solutions for life’s special moments,” Gove added. “We have been operating for more than 50 years and we are committed to performing in the long-term best interests of our stakeholders.”
But the Union, New Jersey-based retailer’s disappearance from so many registries illustrates the toll the company’s recent financial strategy has taken on its core business. A worsening cash crisis forces executives to think of creative ways to raise new funding.
In February, they launched a complex deal with hedge fund Hudson Bay Capital Management to raise a whopping $1 billion. When that flopped in less than two months, Bed Bath & Beyond launched a $300 million share sale — despite a plummeting stock price.
Bed Bath & Beyond needs that money to pay its backers. But the rapid succession of complicated financial deals kept executives and managers busy and made it difficult to focus on the day-to-day task of running stores.
Competitors jump
Meanwhile, competitors have seized their opportunity. Babylist Inc., which has an online baby registry, is schedule to open its first physical store in June – in part to compete with Buybuy Baby.
Amazon.com Inc., Goal corporation and walmart are among the biggest players in baby registries, Natalie Gordon, CEO of Babylist, said in an interview. Buybuy Baby is the largest national specialty retailer, followed by her own company, she said. Babylist declined to say whether there have been any shifts in Buybuy Baby items registered on its site.
Zola, which also has its own online wedding supply store, has seen a surge in sales of cookware, kitchen appliances and bedding in recent months as consumer reluctance to Bed Bath & Beyond grows.
While talking about the retailer’s bankruptcy “is very unfortunate, it has meant positive growth for Zola,” Shan-Lyn Ma, the company’s co-founder and co-CEO, said in a statement. “Couples trust Zola.”