In early February, Bed Bath & Beyond (BBBY) announced it would close 150 company stores. That figure is on top of the 87 stores it closed in January. Since September, 2022, the Union, N.J.-based retailer has closed 400 stores in the U.S. altogether.
The big box retailer had flirted with bankruptcy, before landing $225 million in a recent equity offering and has undergone a major executive reshuffling and monumental financial losses.
DON'T MISS: This Major Mall Retailer Is Shuttering Hundreds of Stores
In the retail sector, that kind of performance often leads to shuttered stores, and that’s certainly the case with Bed, Bath & Beyond. The company has seen its U.S. store count fall from 1,552 stores in 2018 to 260 in 2023.
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As Bed Bath & Beyond Moves Out, Others Move In
To paraphrase an old saw, however, “one store’s pain is another stores gain,” as brand name businesses are signing leases and taking the spaces that once held BB&B stores.
Now, retail names like Dollar Tree (DLTR), TJ Maxx (TJX), Burlington (BURL), HomeGoods, and Ross have stepped into the void left by Bed Bath & Beyond, with other big names, like Planet Fitness and Five Below (FIVE) reportedly in the mix for other former locations.
“For us, the biggest source of new store locations comes from other retailers closing stores,” said Burlington CEO Michael O’Sullivan in a recent conference call. “So many of our most productive locations were formerly Circuit City or Toys ‘R’ Us or Sports Authority.”
With new commercial properties now rare in the age of digital commerce, thriving companies like HomeGoods and Planet Fitness (PLNT) are more than happy to fill vacancies left by the likes of aging or extinct big box brands like Bed Bath & Beyond, Sports Authority, and Circuit City.
Bed, Bath & Beyond locations are especially desirable, offering up to 50,000 square feet of commercial space and close proximity to consumers, especially in large suburbs and big cities.
The ritual discount sector is fueling a boom in the retail space, with new physical stores outpacing closed physical locations by 1% from 2021 to 2023, according to Coresight Research.
“Discount stores led store openings in 2022, accounting for 36% of total store openings,” Coresight reported. “In addition, there were 50% fewer physical store closures than in 2021.”
