After Bed Bath & Beyond reported yesterday that its 2nd quarter estimates fell short of expectations, shares plummeted more than 21% — the biggest drop in the company’s history.
As the economy hums along, all signs indicate brick-and-mortar won’t go extinct as analysts feared — it will simply evolve. But Bed Bath & Beyond’s bumpy road proves adaptation is easier said than done.
But now it just can’t make enough money. The retro retailer can only compete with the prices offered by e-commerce competitors like Amazon when it offers 20%+ discount coupons.
But these steep discounts reduce profitability: The company’s margins have now decreased for 26 consecutive quarters, and there is no hope at the end of this shopping aisle
After the company’s stock fell 50% in 2017, analysts thought the closure of Toys ‘R’ Us might help the struggling home goods chain (which competed with Toys ‘R’ Us in the baby aisle).
But the toy-maker’s bankruptcy may have simply foreshadowed Bed Bath & Beyond’s own journey to the great beyond.
Yesterday, after the company’s worst day in 18 years, Bed Bath & Beyond announced that it had hired 2 management consulting firms to help keep the corporation off the clearance rack.