Mattress Tub & Past is discontinuing non-public label Wild Sage because it tries to enhance gross sales

in 2021 October 1 A man walks into a Bed Bath & Beyond store in New York’s Tribeca neighborhood.

Michael M. Santiago | Getty Images

Bed Bath & Beyond about a year after the company’s aggressive foray into exclusive brands, touted at the time as the core of its turnaround strategy, is shedding one of its private label brands, Wild Sage.

A spokeswoman for the home goods retailer confirmed the brand is being discontinued.

The move is likely to be just the start of bigger changes for Bed Bath and its merchandising approach as it tries to turn around declining sales. to appease activist investors and win back buyers. The retailer has been plagued by inventory and supply chain issues, first losing hundreds of millions of dollars in sales due to out-of-stock items, and more recently, an excess of unwanted products sitting in warehouses and on store shelves.

Bed Bath is also looking for a new leader after the board published at the end of June that CEO Mark Tritton and Chief Commercial Officer Joe Hartsig have left the company. Its chief accountant also left in june.

In a company statement, Bed Bath & Beyond said private brands, which it calls “owned brands,” “have a place in our lineup.”

“Customer feedback has been positive and we are very excited about the strength of several managed brands, such as Simply Essential, which are offering opening prices,” the company said. “At the same time, we recognize that our customers want a better balance of existing and national brands and are making the necessary changes to our assortment to improve the customer experience and increase sales and traffic.”

Bed Bath said it would provide more updates on its strategy this month. A spokeswoman did not say whether the company is considering phasing out other private label brands.

Private labels have become a central part of Tritton’s vision and a dominant part of Bed Bath stores. Triton, a Purpose veteran, joined Bed Bath in 2019 and released a playbook similar to that used by the low-end chic retailer. He oversaw the store move and the debut of linens, cookware and more that couldn’t be found anywhere else.

From 2021 spring Bed Bath introduced nine private labels. One of them was Wild Sage, a brand that the company is described as “stylish, eclectic, free-spirited bedding, decor, furniture, bath accessories and table linens designed for young adults (and the young). The first collection was presented in 2021. in June, just in time for back-to-college season.

However, some customers found the new brand names confusing and less appealing. Instead of seeing large displays of famous national brands, they saw bedding, furniture and tableware with a name they didn’t recognize.

Same store sales fell by 27 percent. For the Bed Bath & Beyond banner in the most recent quarter ended May 28.

Rapid change, alienated customers

Following the company’s last earnings report at the end of June, board member and interim chief executive Sue Gove said the company’s sales performance “fell short of our expectations”.

Jason Haas, a retail analyst at Bank of America Securities, said the retailer alienated its customers by moving too quickly. It also phased out popular 20% off coupons, a move that was later reversed.

“If they rolled out those brands at a measured pace and layered them.” [with national brands] and the customer had some familiarity with seeing them on the shelf would have been more successful,” he said.

In addition, he said, Bed Bath has ended up multiplying supply chain issues related to the pandemic. Almost every retailer has faced congested ports and freight shortages, but private label products tend to have longer delivery times because they are manufactured and shipped from overseas. National brands typically have items that can get to stores faster from U.S. warehouses, Haas said.

Bed Bath’s website shows signs of Wild Sage’s end. His items are available at deep discounts, including a tie robe for $7, down from the original price of $35, and a 16-piece terracotta dinnerware set for $16, down from the original $80. Many other Wild Sage items are out of stock after being sold for up to 90% off.

But as Bed Bath reaches out to more national brands, it may face a different set of problems. Sellers may be reluctant to work with a retailer or ask for upfront payments because the company’s coffers are quickly depleted.

Bed Bath reported $108 million. USD of cash and equivalents as of May 28, compared to $1.1 billion. USD a year ago. Its net loss increased to 358 million. USD from 51 million USD loss in the same period in 2021.

According to a quarterly filing with the Securities and Exchange Commission, the company still has access to $1 billion in cash.

May 28 Bed Bath said it has $200 million under the loan.

Still, analysts believe the home goods retailer will need more cash to sustain the turnaround.

Bed Bath Chief Financial Officer Gustavo Arnal said on a conference call in June that the company still has “sufficient liquidity” with the loan and that it has engaged consultants from Berkeley Research Group, as well as financial advisers, to seek additional capital.

“There are ways we’re looking to further increase our liquidity and get through the working capital cycle, especially in the next two quarters given the seasonal nature of our business,” he said.

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