Bed Bath & Beyond Is Considering Bankruptcy
“Bed Bath & Beyond” is one of those retailers that seem to have always been around…and they have. The company, founded fifty years ago, was, until relatively recently, highly successful. Most of us have, at one time or another, gone to “Bed, Bath & Beyond” with our oversized coupon feeling like we are about to get a great deal.
Today, a visit to a Bed Bath & Beyond store reveals that the company has run out of money, leadership, and new ideas. The stores look sloppy with too much inventory of things people don’t want and empty shelves of products the do. “Bed, Bath & Beyond” never moved out of the 20th century. It is a category killer at a time when that business model has ceased to be effective (just ask Toys R Us). Its use of coupons has joined Kmart’s Blue Light Specials as marketing artifacts from a time when dinosaurs still roamed the earth.
Why should we in the toy industry care? Because Bed Bath & Beyond owns the 122 store “Buy Buy Baby” chain. The loss of Babies R Us in 2017 was a heavy blow to those who deal in preschool and toddler toys. The loss of “Buy Buy Baby,” would have a similar impact.
Container Prices Are Collapsing
Spot market container prices are in free fall. That’s according to an article on gCaptain entitled, “Some Ocean Shipping Rates Collapsing, But Relief is Still Months Away for Big Retailers.”
The cost to send a container from Asia to the United States on the demand-sensitive spot market has tumbled more than 80% from its September peak above $20,000 for a 40-foot container, according to freight booking platform Freightos.“Some Ocean Shipping Rates Collapsing, But Relief is Still Months Away for Big Retailers, Lisa Baertlein, gCaptain
Some of the larger carriers are attempting to stop the drop in price by scrapping older vessels and cutting back on crossings. Nice try shipping companies, but the market is dictating lower prices. Adam Smith’s “invisible hand” is still very much with us.
Product Returns Are Up 63%
According to an article by Dan Berthiaume in CSA, returns of products purchased during the holiday shopping season came to $1.39 billion. That is a year-to-year increase of 63%.
Mr. Berthiaume, in his article, “Salesforce: Online holiday spending rises 5%; returns up 63%,” states, “Returns especially rose in the six days after Christmas (Dec. 26-30), with 16% of orders returned during that week — a 5% increase from 2021.”
Returns of this size are unprecedented. We will have to see how the consumer products industry digests this much product and the concurrent handling costs without getting a world-class stomach ache.
“Economic Policy in a More Uncertain World” – A book-length report on global economic conditions.
The Aspen Economic Strategy Group has issued its annual book on global economic conditions. It covers:
Declining fertility and population aging—and what a smaller worker to population ratio means in terms of slower economic growth, reduced revenue, and lower productivity growth. Additional chapters on the US immigration system and US innovation policy highlight potential solutions for countering these trends. Another chapter explores potential adverse impacts on local labor markets from the green energy transition and highlights policies to avoid repeating painful mistakes of the past, including the response to the decline of the coal industry and rise of globalization and automation. A final chapter highlights lessons learned from the unprecedented federal aid to state and local governments during the COVID-19 pandemic.“Economic Policy in a More Uncertain World” The Aspen Economic strategy group
It is provocative, deeply researched, and it is free. I suggest that you check it out by clicking here.