Bed, Bath and Bye Bye: Company is officially in default

[storewanderer]

Of course severance isn't going out as promised since the company has no money and at this point is doing a fire sale of stores/inventory to liquidators for immediate cash just to, literally, keep the lights on. I don't think I've seen such a poorly run "end" for a company ever. This thing is being run like some little independent owner operated business who ran out of money and doesn't really know what to do so everything is on the fly. At the end of the day the employees get screwed and that is always how these things go. Maybe store managers are getting retention bonuses (I haven't heard this is the case yet), we know executives are loading their pockets still. I suspect middle management has all been laid off.

I expect the liquidations being handled by liquidators will be more successful.

The only thing that is somewhat iffy is the merchandise present in the stores is so bad, a lot of it may be a pretty hard sell.

BBB seems to have been emptying its warehouses in the self liquidating stores and moving stuff around, especially large ticket items like strollers and ready to assemble furniture, into the stores they are self liquidating in an effort to monetize that higher value inventory.

I think the liquidators may be left with a situation where they have a bunch of stores full of largely junk left that won't sell so well. What we don't know is how much merchandise of their own the liquidators will bring in to make these things go better/increase customer interest.

The other positive about the liquidators is they won't have so little money to fund payroll like the current BBB that they have a store with hours 10-6 7 days a week that has one employee on duty on a Saturday during the liquidation sale.

[storewanderer]

This link highlights how the Reno BBB (not yet announced as closing) looks at this point:


There are 20 pictures in the above link. I suspect at this point any non closing store that does even moderate volume looks like this.

The closing stores are better stocked than the non-closing stores.

[ClownLoach]

Of course severance isn't going out as promised since the company has no money and at this point is doing a fire sale of stores/inventory to liquidators for immediate cash just to, literally, keep the lights on. I don't think I've seen such a poorly run "end" for a company ever. This thing is being run like some little independent owner operated business who ran out of money and doesn't really know what to do so everything is on the fly. At the end of the day the employees get screwed and that is always how these things go. Maybe store managers are getting retention bonuses (I haven't heard this is the case yet), we know executives are loading their pockets still. I suspect middle management has all been laid off.

I expect the liquidations being handled by liquidators will be more successful.

The only thing that is somewhat iffy is the merchandise present in the stores is so bad, a lot of it may be a pretty hard sell.

BBB seems to have been emptying its warehouses in the self liquidating stores and moving stuff around, especially large ticket items like strollers and ready to assemble furniture, into the stores they are self liquidating in an effort to monetize that higher value inventory.

I think the liquidators may be left with a situation where they have a bunch of stores full of largely junk left that won't sell so well. What we don't know is how much merchandise of their own the liquidators will bring in to make these things go better/increase customer interest.

The other positive about the liquidators is they won't have so little money to fund payroll like the current BBB that they have a store with hours 10-6 7 days a week that has one employee on duty on a Saturday during the liquidation sale.

Remember, BB&B didn't have warehouses until just recently. Tritton was just setting them up when he was fired, and they were 3rd party operations which cost a bloody fortune to operate as they were basically charged for every time an item was touched. I believe the stores were still receiving the bulk of goods DSD as they did since the 80's. The warehouses probably only moved house brands, and they were already killing those off.

Their systems are ancient and proprietary. I could be wrong but I am not sure if they even started implementing automatic replenishment ordering yet. Prior to Tritton it was all manually ordered by department managers. I really think the bankruptcy holdup is that there isn't any inventory, the systems are so jacked up they are just figuring out there isn't any inventory, there isn't any money (except in the executive's pockets), and what they do have technically is already property of the asset backed lender (Chase I believe) but they are not only in default but then liquidating those goods to pay other creditors and employees.

So they can't borrow money against the company assets for bankruptcy DIP (debtor in possession) loans because they took the same loan out of bankruptcy. At this point the entire chain could potentially be liquidated before a Chapter 11 is filed. Doing a Google search without reading SEC filings it looks like the loans taken in August which they defaulted on a few days ago are literally out of court restructuring DIP loans. In theory the bank can instantly request a full liquidation of the E tire fom

And to make the situation worse they are liquidating the biggest stores with the most inventory, the stores that would be most important to operate for the company to have a chance at survival. I'm sure the only reason they haven't closed the flagships in NYC that were just lavishly remodeled is because they invited the media to trot around in a dog and pony show just before Tritton was shown the door. It would create opportunities for the media to question I posed previously on the world's largest spotlight (the NYC media), the statements to the media that unimportant and unproductive low volume stores are the only closures. I really think the only criteria for a closure is how much Hilco or whoever else offered up for that store's liquidation, payable in cash in advance. This is a worse train wreck than any other death of a big chain I can think of in decades.

By the way the bankruptcy restructuring specialist they hired literally has a contract that says her salary is $30,000 a month, to be paid.... cash in advance!

[storewanderer]

Remember, BB&B didn't have warehouses until just recently. Tritton was just setting them up when he was fired, and they were 3rd party operations which cost a bloody fortune to operate as they were basically charged for every time an item was touched. I believe the stores were still receiving the bulk of goods DSD as they did since the 80's. The warehouses probably only moved house brands, and they were already killing those off.

Their systems are ancient and proprietary. I could be wrong but I am not sure if they even started implementing automatic replenishment ordering yet. Prior to Tritton it was all manually ordered by department managers. I really think the bankruptcy holdup is that there isn't any inventory, the systems are so jacked up they are just figuring out there isn't any inventory, there isn't any money (except in the executive's pockets), and what they do have technically is already property of the asset backed lender (Chase I believe) but they are not only in default but then liquidating those goods to pay other creditors and employees.

So they can't borrow money against the company assets for bankruptcy DIP (debtor in possession) loans because they took the same loan out of bankruptcy. At this point the entire chain could potentially be liquidated before a Chapter 11 is filed if aki. And to accelerate that problem they are liquidating the biggest stores with the most inventory, the stores that would be most important to operate for the company to have a chance at survival. I'm sure the only reason they haven't closed the flagships in NYC that were just lavishly remodeled is because they invited the media to trot around in a dog and pony show just before Tritton was shown the door. It would create opportunities for the media to question I posed previously on the world's largest spotlight (the NYC media), the statements to the media that unimportant and unproductive low volume stores are the only closures. I really think the only criteria for a closure is how much Hilco or whoever else offered up for that store's liquidation, payable in cash in advance. This is a worse train wreck than any other death of a big chain I can think of in decades.

By the way the bankruptcy restructuring specialist they hired literally has a contract that says her salary is $30,000 a month, to be paid.... cash in advance!

I wonder how Harmon received goods, maybe that had a warehouse? But that is small value stuff.

So really the warehouses, given the private label strategy fell on its face, are not really needed at this point and just because those don't have freight flowing through, doesn't mean freight may not be sent direct to the stores (branded items) like in the past. However from what I am observing it does not appear the stores are receiving inventory that way lately.

HQ is in NJ and it seems like a ton of stores are closing in NJ, I'm not sure how many are staying open. Perhaps they are saturated there also. Maybe they closed more in NJ to save the NY stuff for another few days.

I don't think I've seen a chain go down quite the way this one is before. This is a really strange one. Stage Stores was a little strange but nothing like this.

[ClownLoach]

Remember, BB&B didn't have warehouses until just recently. Tritton was just setting them up when he was fired, and they were 3rd party operations which cost a bloody fortune to operate as they were basically charged for every time an item was touched. I believe the stores were still receiving the bulk of goods DSD as they did since the 80's. The warehouses probably only moved house brands, and they were already killing those off.

Their systems are ancient and proprietary. I could be wrong but I am not sure if they even started implementing automatic replenishment ordering yet. Prior to Tritton it was all manually ordered by department managers. I really think the bankruptcy holdup is that there isn't any inventory, the systems are so jacked up they are just figuring out there isn't any inventory, there isn't any money (except in the executive's pockets), and what they do have technically is already property of the asset backed lender (Chase I believe) but they are not only in default but then liquidating those goods to pay other creditors and employees.

So they can't borrow money against the company assets for bankruptcy DIP (debtor in possession) loans because they took the same loan out of bankruptcy. At this point the entire chain could potentially be liquidated before a Chapter 11 is filed if aki. And to accelerate that problem they are liquidating the biggest stores with the most inventory, the stores that would be most important to operate for the company to have a chance at survival. I'm sure the only reason they haven't closed the flagships in NYC that were just lavishly remodeled is because they invited the media to trot around in a dog and pony show just before Tritton was shown the door. It would create opportunities for the media to question I posed previously on the world's largest spotlight (the NYC media), the statements to the media that unimportant and unproductive low volume stores are the only closures. I really think the only criteria for a closure is how much Hilco or whoever else offered up for that store's liquidation, payable in cash in advance. This is a worse train wreck than any other death of a big chain I can think of in decades.

By the way the bankruptcy restructuring specialist they hired literally has a contract that says her salary is $30,000 a month, to be paid.... cash in advance!

I wonder how Harmon received goods, maybe that had a warehouse? But that is small value stuff.

So really the warehouses, given the private label strategy fell on its face, are not really needed at this point and just because those don't have freight flowing through, doesn't mean freight may not be sent direct to the stores (branded items) like in the past. However from what I am observing it does not appear the stores are receiving inventory that way lately.

HQ is in NJ and it seems like a ton of stores are closing in NJ, I'm not sure how many are staying open. Perhaps they are saturated there also. Maybe they closed more in NJ to save the NY stuff for another few days.

I don't think I've seen a chain go down quite the way this one is before. This is a really strange one. Stage Stores was a little strange but nothing like this.

The vendors quit shipping unless paid cash in as advance, so nothing is arriving via DSD for sure. I really am convinced that they ran out of merchandise to even liquidate to repay the secured loan... And I wonder how much worse it could potentially be. Did they not have enough merchandise all the way back when they got the loan, which means they borrowed more than they should have? This is speculation of course. Something strange happened here.

[norcalriteaidclerk]

https://www.nytimes.com/2023/02/06/busi ... ering.html

Desperation...but are they truly smart?

Sent from my SM-G781U using Tapatalk

[pseudo3d]

You can't astroturf your own meme stock, and part of what made the GameStop stock scenario interesting was that there was done to screw over investors who had bet against GameStop.

[ClownLoach]

I cannot imagine any world in which BB&B has less than a couple hundred million of assets left. The SEC isn't going to allow them to knowingly sell significantly more stock than assets even if it would bail them out of default since they do not have a viable business model at this time. Same way they didn't let Hertz sell more stock. And if you're an investor interested in that stock knowing that you are buying a stake in empty shelves in a leased building here is my recommendation: go to Walmart, grab a Keurig coffeemaker. Go to self check out. Scan the one coffeemaker at least 5 times. If you are comfortable with hitting total and paying what the register asks at that point then you probably are so comfortable with buying up a good size lot of those new BB&B shares. You're doing the same thing either way, paying at least 5 times the value of merchandise.

Whatever they bring in will pay off the current loan but won't fix their broken credit rating. Whatever else comes in will probably go right to the executives or down the toilet (they currently are losing $4.3 million dollars a day and getting worse as they run out of merchandise to sell)

[storewanderer]

Clearly I have been wrong here. BBB and bankruptcy does not even seem to be on the table. Instead BBB is going to raise $1 billion through a stock sale and completely revive what is left of their company. It it tough to know what is left given how fluid the store closure program is. It is also most curious how they plan to deal with leases on so many dark stores. But they clearly are very smart and have come up with a grand plan to avoid bankruptcy. They will show everyone.

If only Toys R Us had come up with this idea...

Is this for real?

[veteran+]

Again, fine example of corporate America's C-Suite MBA geniuses!