Bed Bath & Beyond (BBB) has everything you need to play
"house" for real. It's the nation's #1 superstore domestics
retailer with more than 1,020 BBB stores throughout the US, Puerto
Rico, and Canada. The stores' floor-to-ceiling shelves stock
better-quality (brand-name and private-label) goods in two main
categories: domestics (bed linens, bathroom and kitchen items) and
home furnishings (cookware and cutlery, small household appliances,
picture frames, and more). BBB also operates more than 275 Cost
Plus and World Market stores, and three smaller specialty chains:
about 80 Christmas Tree Shops; 105 buybuy BABY stores; and more
than 50 Harmon discount health and beauty shops.
Nearly all of the New Jersey-based retailer's more than 1,500
stores are in the US, though 46 of its stores are located across
nine Canadian provinces while three are in Puerto Rico. About 38%
of the company's stores are in five US states: California, Texas,
Florida, New York, and New Jersey.
Beyond its main BBB-branded chain of more than 1,020 stores, the
retailer operates more than 275 stores under the names World
Market, Cost Plus World Market, and World Market Stores banners. It
also operates 105 buybuy BABY shops, almost 80 Christmas Tree
Shops, and more than 50 stores under the names Harmon and Harmon
Face Values. In Mexico, BBB also has a joint venture with Mexican
retailer Home & More, where it currently operates seven stores
under the BBB banner.
Sales of home furnishings generated 64% of the retailer's total
revenue in fiscal 2016 (February year end), while domestic
merchandise made up 36% of total revenue during the year.
Sales and Marketing
BBB likes to locate its stores in strip malls and power strip
shopping centers in suburban areas of medium and large-sized
cities. It also places its stores near major off-price and
The chain relies exclusively on circulars, mailings, and
word-of-mouth for advertising. Advertising costs amounted to $338.1
million, $308.4 million and $280.5 million for fiscal 2016, 2015,
and 2014, respectively.
The company has the ability to have customer purchases picked up
in-store or shipped direct to the customer from its distribution
facilities, stores, or vendors.
A substantial portion of the company's merchandise is shipped to
stores through a combination of third party facilities, including
cross dock locations, or company-operated distribution
facilities. The remaining merchandise for stores is shipped
directly from vendors.
In fiscal 2016, BBB purchased its merchandise from 9,100 suppliers,
with the company's largest supplier accounting for 4% of its
merchandise purchases, and BBB's 10 largest suppliers accounting
for 15% of such purchases. The company purchases substantially all
of its merchandise in the US, the majority from domestic sources
and the balance from importers.
BBB's sales have been steadily growing for each of the past few
years thanks to a strengthening US economy and increased business
In fiscal 2016 net sales increased by 2% due to higher comparable
sales driven by increase in the average transaction.
Net income decreased by $115.9 million due to increased selling,
general, and administrative expenses, partially offset by higher
Selling, general, and administrative expenses rose as the result of
increased technology expenses and related depreciation and
increased advertising expenses, due in part to the growth in
In fiscal 2016 net cash provided by the operating activities
decreased by $166.3 million due to changes in accounts payable.
BBB strategy is to expand its market reach either through
strategic acquisitions or organically by adding stores in both new
and existing markets. To this end, in fiscal 2016, the company
opened 29 new stores, closed 12 stores and opened a new customer
contact center in Layton, Utah and a new distribution facility in
BBB also wants to further enhance its omnichannel capabilities
through such initiatives as adding new functionality to its
e-commerce and mobile sites, and by opening new distribution
centers for both direct to consumer and store fulfillment.
Additionally, it plans to expand specialty departments in its
stores in areas such as health and beauty care, baby specialty
food, and specialty beverage sections.
The retailer's decentralized structure allows store managers to
have more control than their peers at other retailers (and the
company has less manager turnover). BBB cuts costs by locating its
stores in strip shopping centers, freestanding buildings, and
off-price malls, rather than in pricier regional malls. To cut
costs further, its vendors ship merchandise directly to the stores,
eliminating the expense of a central distribution center and
reducing warehousing costs.
In 2016 Alliance Data Systems and BBB signed a new long-term
agreement to develop a co-brand credit card program.
That year BBB launched the ED Ellen DeGeneres bedding
Mergers and Acquisitions
In 2016 the company acquired online home goods retailer One
Kings Lane Inc. in an all-cash deal. The deal, the value of which
was undisclosed, bolsters BBB's furniture and home décor offerings
in the online space. One Kings offers an extensive collection of
designer and vintage furniture, rugs, kitchenware, lighting, and
other décor for homes.
Also in 2016, the company acquired PersonalizationMall.com, a
online seller of personalized gifts, for $190 in cash.
In 2015 BBB acquired Of a Kind, an e-commerce website that
features specially commissioned, limited edition items from
emerging fashion and home designers.