Just days after hosting around 500 vendors for a summit outlining its new strategy, Bed Bath & Beyond has seen several suppliers stop or restrict shipments.
According to a report from Bloomberg, Dbest Products Inc.—which has sold its rolling carts to the retailer for more than a decade—and longtime kitchen storage product supplier YouCopia both halted merchandise shipments to the embattled retailer.
“We requested to alter our payment terms to payment in advance and they said no— politely,” Dbest Products CEO Richard Elden told Bloomberg. “We’d rather keep our product for customers that we expect will pay us with no issues and no problems.”
During the recent vendor summit, newly named Bed Bath & Beyond CEO Sue Gove outlined the company’s plans for reversing its years-long revenue declines, which includes closing stores, trimming staff and returning to a national brand focus.
One of the main issues Gove addressed during the meeting was overdue payments to suppliers, saying the company had recently caught up on those bills. One source of funding for merchandise shipments is the $500 million Bed Bath & Beyond secured in financing for incremental liquidity, including an expanded asset-based loan facility of $1.13 billion and $375 million in the form of a first-in, last-out loan.
But suppliers speaking anonymously to Bloomberg said they were disappointed by the meeting, saying Bed Bath & Beyond simply reiterated what they’d already said publicly.
Shortly after the vendor summit, Bed Bath & Beyond filed a Form 8-K with the Securities and Exchange Commission, registering additional shares of its common stock, par value $0.01 per share for sale under the company’s at the market offering program, pursuant to the company’s existing open market sale agreement with Jefferies LLC. According to the filing, the company intends to use any net proceeds for immediate strategic priorities such as rebalancing the retailer’s assortment and inventory, and addressing debt.
Bed Bath & Beyond filed another form with the SEC on Nov. 1, announcing that executive vice president and chief customer and technology officer Rafeh Masood will resign, effective Dec. 2. According to an SEC filing, “Mr. Masood’s resignation was not the result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices or financial statements.” Masood was recruited by former Bed Bath & Beyond CEO Mark Tritton. The company recently reported it’s investigating a possible data breach.
In the wake of these developments, Bed Bath & Beyond’s stock dropped to $3.92 per share in Friday afternoon trading. The stock is down 75 percent this year, as of Thursday.