Just days after its latest earning call, Bed Bath & Beyond has enlisted turnaround consultants AlixPartners as its new restructuring advisor, according to a Reuters report.
Sources familiar with the matter told Reuters that AlixPartners replaced consulting firm Berkeley Research Group LLC, which Bed Bath & Beyond has been working with since the middle of last year. The retailer also has been working with investment banker Lazard Ltd. and law firm Kirkland & Ellis LLP as it weighs its options, potentially preparing for bankruptcy.
Earlier this week, Bed Bath & Beyond announced dismal third-quarter sales, with a 33 percent net decline and a comparable sales drop of 32 percent. CEO Sue Gove said the company would enact $80-$100 million in cost reductions across its corporate structure, including layoffs and expense reductions.
Bed Bath & Beyond has seen a major dip in foot traffic and customer interest over the past two years. According to research analysts at YipitData, Bed Bath & Beyond’s wallet share has dropped to 23 percent for the most recent quarter, compared to 42 percent for that same quarter in 2020.
Bed Bath & Beyond has lost some of that wallet share to home goods competitors such as HomeGoods and Wayfair, which netted 28 percent and 27 percent of share respectively for the most recent quarter.
The retailer struggled to keep inventory on its shelves during the fiscal 2022 third quarter, with in-stock levels in the 70 percent range. Some of those shortfalls came as a result of vendors halting or delaying shipments due to unpaid invoices. Gove recently said those bills have been settled.
Bed Bath & Beyond told Reuters this week that it was “working with strategic advisors to evaluate all paths to regain market share and enhance liquidity.”
Requests for comment from AlixPartners and Bed Bath & Beyond were not returned.