Why Bed Bath And Pier 1 are two sides of the same piece of detail

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In the furniture market, which is perhaps the strongest and most robust for at least a decade, two national retailers that are just selling in this sector are stumbling a lot, not necessarily in danger of sinking, but edge of a serious disaster.

For bed Bath & amp; Beyond and at the first pillar, the clock of the retail store turns … and shouts loudly. Although each company has a balance sheet that does not necessarily go into bankruptcy territory, investors, suppliers and – more importantly – paying customers – lack patience and use their credit cards more and more.

Each retailer has absolutely dismal sales figures, with the additional store sales being marked in red ink. And everyone is trying to put together a recovery plan that will bring it back to positive territory. But each one also carries relatively low levels of debt and does not use private equity as it has greatly reduced the number of retail victims such as Toys'R'Us and Payless.

An examination of the individual elements of the positions of the two retailers shows some similarities about their problems, but glaring differences in the way they handle these situations.

What is similar:

1. Every retailer has too many stores. The Pier 1 has about 1,000 locations, about 10% more than Bed Bed, but when it adds other brands such as buy buy and Cost Plus World Market, this figure reaches more than 1,400 stores physical.
2. Everyone has too many bad shops. Pier 1 initially engaged in a strategy to position many of its stores just outside regional shopping centers. Many of them collapse, which poses great traffic problems for these aberrant locations. BBB's real estate strategy has always been based on the fact that it was a destination, which has often resulted in mediocre locations and unusual choices. It worked for a long time, until buyers stopped blossoming in the e – commerce era.
3. Everyone has seriously under-invested in his physical footprint. In 2004, you will visit the typical shops of one or the other company and you will feel practically in 2004. The stores are overloaded with poorly chosen objects and of mediocre quality.
4. Everyone is unfortunately late on the e-commerce curve. In fact, Pier 1 had stopped selling online for several years under a previous direction, claiming that he devoted all his efforts and all his financial resources to setting his physical activity. When he finally got back on the Internet, his stores did not improve and his online business had to restart from scratch. Bed Bath was at least one of the first adapters online, but he refused to invest in the business and found himself catching up since then, in the face of more tech-savvy competitors who understood that e-commerce was not a static game.
5. Finally, everyone simply refused to accept the obvious conclusion and realized that something had to be done drastically to get back into the game. When Target went through such a moving moment, the management announced on Wall Street and Main Street that the situation was going to be difficult for a while as it was getting in trouble. Several years later, after reinvesting billions in the business. Target leverages the benefits of its mbadive turnaround plan. Bed Bath and Pier 1 have systematically failed to make a serious mea culpa and swallow their pride. Instead, they opted for small incremental improvements and bleached the situation by promising better times in the next quarterly turns.

What is not similar

1. Quai 1 at least tried to admit that the current management did not do this and they have sold the corner office twice in recent years. The fact that he did not do much to the difference is also important, at least he went so far. Bed Bath largely kept its management team (and its board of directors) in place, only finally giving in and changing the chief trader position last year.
2. In line with staff changes, Pier 1 now has a CEO and a CFO whose CVs are stacked with rollover situations. They also used advisors to talk about dreaded situations called "other options". BBB stays with the crowd that brought them to where they are now, saying that they are the ones who can bring them back to the golden age.
3. Although the two retailers have not talked about mbadive store closures that could possibly be needed for survival, Pier 1, announcing his dark quarter earlier this week, said it could close until it was closed. 145 stores (representing 15 of its total footprint). Earlier this month, Bed Bath announced it has announced the closure of 40 stores across the chain, less than 3% of the total.
4. Each company has talked about savings, but each follows different routes to reach them. Bed Bath wants to cut its couponing, which is its fundamental marketing tool. Quay 1 is less specific and speaks of more efficient merchandising methods and reduced overhead costs badociated with fewer stores. Oddly enough, Bed Bath still expects significant stock repurchases, which have proven to be one of the worst uses of excess capital in recent years.
5. Finally, there may be the biggest difference between these two retailers losing ground. Bed Bath is a group of dissident investors who are demanding that management and the board of directors work hard in the guts, while substantially modifying the company's methods of operation. Although they control a relatively small number of actions – about 5% – they are very vocal and even more stubborn. No one else wants the pillar 1. With a market cap of just under $ 40 million at the close on Thursday of this week, an adventurous bidder could buy the company and put it on his Platinum Amex card … and have enough credit left to start repairing the spot.

One of the most common elements of the puzzle is that none of them has an endless track to recover. Retail has become a very tough business these days and even companies with decent balance sheets have gone from trouble to disappear in less time than it takes to decorate your dining room. ;water.

Whatever the way this coin will continue to flip, & nbsp; if things continue to deteriorate as they have recently & nbsp; it could end up being hidden for one or both companies.

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In the furniture market, which is perhaps the strongest and most robust for at least a decade, two national retailers that are just selling in this sector are stumbling a lot, not necessarily in danger of sinking, but edge of a serious disaster.

For Bed Bath & Beyond and Pier 1, the point of sale clock starts spinning … and out loud. Although each company has a balance sheet that does not necessarily go into bankruptcy territory, investors, suppliers and – more importantly – paying customers – lack patience and use their credit cards more and more.

Each retailer has absolutely dismal sales figures, with the additional store sales being marked in red ink. And everyone is trying to put together a recovery plan that will bring it back to positive territory. But each one also carries relatively low levels of debt and does not use private equity as it has greatly reduced the number of retail victims such as Toys'R'Us and Payless.

An examination of the individual elements of the positions of the two retailers shows some similarities about their problems, but glaring differences in the way they handle these situations.

What is similar:

1. Every retailer has too many stores. The Pier 1 has about 1,000 locations, about 10% more than Bed Bed, but when it adds other brands such as buy buy and Cost Plus World Market, this figure reaches more than 1,400 stores physical.
2. Everyone has too many bad shops. Pier 1 initially engaged in a strategy to position many of its stores just outside regional shopping centers. Many of them collapse, which poses great traffic problems for these aberrant locations. BBB's real estate strategy has always been based on the fact that it was a destination, which has often resulted in mediocre locations and unusual choices. It worked for a long time, until buyers stopped blossoming in the e – commerce era.
3. Everyone has seriously under-invested in his physical footprint. In 2004, you will visit the typical shops of one or the other company and you will feel practically in 2004. The stores are overloaded with poorly chosen objects and of mediocre quality.
4. Everyone is unfortunately late on the e-commerce curve. In fact, Pier 1 had stopped selling online for several years under a previous direction, claiming that he devoted all his efforts and all his financial resources to setting his physical activity. When he finally got back on the Internet, his stores did not improve and his online business had to restart from scratch. Bed Bath was at least one of the first adapters online, but he refused to invest in the business and found himself catching up since then, in the face of more tech-savvy competitors who understood that e-commerce was not a static game.
5. Finally, everyone simply refused to accept the obvious conclusion and realized that something had to be done drastically to get back into the game. When Target went through such a moving moment, the management announced on Wall Street and Main Street that the situation was going to be difficult for a while as it was getting in trouble. Several years later, after reinvesting billions in the business. Target leverages the benefits of its mbadive turnaround plan. Bed Bath and Pier 1 have systematically failed to make a serious mea culpa and swallow their pride. Instead, they opted for small incremental improvements and bleached the situation by promising better times in the next quarterly turns.

What is not similar

1. Quai 1 at least tried to admit that the current management did not do this and they have sold the corner office twice in recent years. The fact that he did not do much to the difference is also important, at least he went so far. Bed Bath largely kept its management team (and its board of directors) in place, only finally giving in and changing the chief trader position last year.
2. In line with staff changes, Pier 1 now has a CEO and a CFO whose CVs are stacked with rollover situations. They also used advisors to talk about dreaded situations called "other options". BBB stays with the crowd that brought them to where they are now, saying that they are the ones who can bring them back to the golden age.
3. Although the two retailers have not talked about mbadive store closures that could possibly be needed for survival, Pier 1, announcing his dark quarter earlier this week, said it could close until it was closed. 145 stores (representing 15 of its total footprint). Earlier this month, Bed Bath announced it has announced the closure of 40 stores across the chain, less than 3% of the total.
4. Each company has talked about savings, but each follows different routes to reach them. Bed Bath wants to cut its couponing, which is its fundamental marketing tool. Quay 1 is less specific and speaks of more efficient merchandising methods and reduced overhead costs badociated with fewer stores. Oddly enough, Bed Bath still expects significant stock repurchases, which have proven to be one of the worst uses of excess capital in recent years.
5. Finally, there may be the biggest difference between these two retailers losing ground. Bed Bath is a group of dissident investors who are demanding that management and the board of directors work hard in the guts, while substantially modifying the company's methods of operation. Although they control a relatively small number of actions – about 5% – they are very vocal and even more stubborn. No one else wants the pillar 1. With a market cap of just under $ 40 million at the close on Thursday of this week, an adventurous bidder could buy the company and put it on his Platinum Amex card … and have enough credit left to start repairing the spot.

One of the most common elements of the puzzle is that none of them has an endless track to recover. Retail has become a very tough business these days and even companies with decent balance sheets have gone from trouble to disappear in less time than it takes to decorate your dining room. ;water.

No matter how this retail coin continues to reverse, if the situation continues to deteriorate as it has done recently, it could eventually end up being face down for one or both companies.