BofA Accuses Bed Bath & Beyond Of Cutting AC To Save Money
Bank of American has accused struggling retailer Bed Bath & Beyond of cutting off air conditioning in stores in order to quickly lower expenses amid a slump in sales.
The company hit back, however, telling CNN that any changes in store temperature didn’t come from corporate.
“We’ve been contacted about this report, and to be clear, no Bed Bath & Beyond stores were directed to adjust their air conditioning and there have been no corporate policy changes in regard to utilities usage,” a spokesperson said.
After conducting in-person store visits, however, BofA analysts reported “mounting concerns” over significant cuts in employee hours, scaled back utilities, reduced operating hours, and remodeling projects which have been canceled.
What’s more, the company’s rewards program has been scaled back and replaced.
All of this has led the Bank of America analysts to predict that Bed Bath & Beyon will soon announce more closures, as well as a halt to its Buy Buy Baby stores.
Meanwhile, analysts at Riley Securities noted that sales promotions have also fallen flat, along with a decrease in store traffic – causing them to reduce their price target from $17 to $7.
The changes come ahead of the homegoods retailer’s first quarter report, set to be released this week, and follow a devastating report last quarter when sales plunged 22%. Bed Bath & Beyond’s CEO Mark Tritton said the unavailability of certain products caused by supply chain kinks resulted in about $175 million of lost sales during the period.Bank of America analysts believe sales will drop another 20% this quarter.“The company has been underperforming the industry and we think consensus estimates [of an 18% drop in sales] may be optimistic,” they wrote. -CNN
Tue, 06/28/2022 – 22:25