Bed Bath & Beyond is accelerating its restructuring plan with the layoffs of 2,800 employees at both the corporate and store level. The move is expected to generate future annual pre-tax cost savings of approximately $150 million. These savings will build on the retailer’s other efforts to deliver improvement in annualized EBITDA of between approximately $250 million to $350 million, excluding one-time costs, over the next two to three years.
The layoffs are designed both to reduce the number of layers at the corporate level and to reposition field operations for the current digital-first shopping environment, as well as realign technology, supply chain and merchandising teams to support strategic growth initiatives. The move is expected to simplify the retailer’s operations, support investment in its strategic growth plans and provide additional financial flexibility as well.
“Saying goodbye to colleagues and friends is incredibly difficult, but this component of our comprehensive restructuring program is critical to rebuild the foundation of our business, construct a modern, balanced and durable business model and meet the structural shift in customer shopping and service preferences that we have seen accelerate as a result of COVID-19,” said Mark Tritton, President and CEO of Bed Bath & Beyond in a statement. “Today’s action forms part of a series of changes we are making to reduce the cost of our business, further simplify our operations and support our teams so we can emerge from the pandemic in an even stronger position.”
In March 2020, Bed Bath & Beyond laid off 10% of its corporate workforce, about 500 employees, during an earlier phase of this realignment. This company cited a similar goal of simplifying field operations and expects annual cost savings of $85 million as a result of the move.
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The changes will help fund a number of growth initiatives that will enhance an “omni-always” shopping experience, both in-store and online. Like many retailers, Bed Bath & Beyond has launched buy online, pick up in-store (BOPIS) and curbside pickup services, and it also plans to launch several customer-inspired brands in 2021 and undergo an initiative to transform its supply chain.
