Mark Tritton, president, CEO, Bed Bath & Beyond
UNION, NJ—Struggling retailer Bed Bath & Beyond announced late last week what it termed was "a major pivot" in the company's restructuring plan that will include the reduction of its workforce by approximately 500 positions.
The locally-based retailer said the plan is focused on realizing several hundred million dollars of cost savings opportunities. The overall restructuring program is expected to reduce annual SG&A (selling, general and administrative expenses) by approximately $85 million, The company states that the strategic realignment is geared at creating a greater focus on the company's core business and initiatives designed to enhance the customer experience, drive sales and position the company for long-term success.
The restructuring program includes a reorganization and simplification of its field operations, significant reduction in management positions across the business and outsourcing of several functions.
Bed Bath & Beyond's president and CEO Mark Tritton said, "We are announcing extensive changes today to right-size our organization as part of our efforts to reconstruct a modern, durable business model. We do not take this action lightly but, while difficult, these measured and purposeful steps are necessary.
He adds that the plan will reset the company's cost structure allowing the retailer to "re-invest where it matters most to our customers, to re-establish our authority in the home space."
In connection with this restructuring program, Bed Bath & Beyond expects to incur net pre-tax charges of approximately $26 million, primarily for severance and related costs, all of which will be expensed in the fiscal 2019 fourth quarter.
The company states that the restructuring program will simplify and remove spans and layers of management to bring the company in line with industry best practice; remove duplicative or redundant roles to streamline the organization; reduce and realign regional zones to simplify and restructure field operations; and outsource several functions to allow the company to focus on core competencies.
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John Jordan
John Jordan is a veteran journalist with 36 years of print and digital media experience.
