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CEO Mark Tritton said in a statement that the chain’s sales were strong in June, but then fell over the next two months due to “unexpected external disruptive forces,” namely the growing spread of Covid-19 and current supply chain challenges.
Tritton said the Delta variant hurt sales in several major states, including Texas, Florida and California – virus hot spots that make up a “substantial portion” of the company’s total revenue.
On top of that, the supply chain issues that have ravaged several industries over the past year and a half intensified in August. Tritton called the disruption “unprecedented” and said rising inflation “had an impact on sales and gross margin.” This led to supply prices much higher than Bed bath and beyond (BBBY) predicted, tipping the company to a loss of $ 73 million across all of its brands. Flagship store sales fell 4%.
However, Tritton remains “confident” in the company’s multi-year transformation which includes the creation of new private labels and store renovations. Bed Bath & Beyond’s new flagship location in New York City, which opened in July, is exceeding expectations, Tritton said.
Bed Bath & Beyond is renovating 450 stores, representing about half of its locations, at a cost of $ 250 million. The company has been hit by declining sales and declining foot traffic in recent years, as shoppers ditch competitors like Target and Amazon, which offer many of the same staples that Bed Bath & Beyond sells. The company is also closing 200 underperforming stores.
Tritton joined Bed Bath & Beyond from Target (TGT) two years ago and led the business through a turnaround over the past year as homebound shoppers ramped up spending on kitchen and home essentials.
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