Bed Bath & Beyond will be closing all of its stores in Canada as the retail chain has succumbed to years of operating at a net loss.
The company is winding down its operations in all 54 Bed Bath & Beyond stores across the country, as well as 11 buybuy Baby stores. With these closures, 387 full-time employees and 1038 part-time employees will lose their jobs, according to court documents from a hearing on Feb. 10 to address the company’s arrangements with its creditors.
“The Bed Bath & Beyond Group has been in financial difficulty for a number of years, suffering significant net losses since 2018,” the company’s interim CFO, Holly Etlin, had told the court. The company’s situation worsened throughout 2022 and finally in January 2023, the company defaulted on some of its payments.
U.S. Stores May Survive
The U.S. parent company, Bed Bath & Beyond Inc., has also experienced a sharp decline and cannot support Canadian operations any further, the documents said. The U.S. company announced the closing of more than 200 stores in 2023.But it has also recently raised almost $1 billion through offerings of preferred stocks and warrants that it says it will use toward its debts.
“The Bed Bath & Beyond Group has concluded that there is not enough capital available to restructure both its business in the United States and properly restructure the Canadian business to achieve profitability,” the documents say.
Bed Bath & Beyond Canada is insolvent and consultancy firm Alvarez & Marsal has been appointed to monitor its winddown. The Epoch Times contacted the company to ask about timelines for store closures, but did not receive a reply as of publication.
Any one with gift cards for the company should use them by Feb. 25. Beyond that date, says the court, the company is not obligated to fulfill them, though it is entitled to do so.
The court documents show that for a nine-month period ending Nov. 26, 2022, Bed Bath & Beyond stores reported a net loss of $87.6 million. For the same period, buybuy Baby had a net loss of $11.9 million.
Surge in Business Insolvencies
Last year, the number of Canadian businesses that became insolvent—unable to pay down their debt—surged by 37.2 percent. There were 3,402 business insolvencies last year, compared to 2,480 in 2021, according to the Office of the Superintendent of Bankruptcy.This comes after years of decline in the number of insolvencies.
From 2020 to 2021, business insolvencies declined 11 percent. From 2019 to 2020, they declined 24.3 percent.
In 2019, they had increased slightly—2.8 percent—but that was the first increase since 2001. And the decline had been so great since 2001 that the volume of insolvency filings in 2019 was still only 30 percent of the volume in 2001.
