As Bed Bath & Beyond continues to struggle, it has already closed some of its stores and may have to shutter even more, especially if it files for bankruptcy. It can promote its competitors with stores near those locations, according to Telsey Advisory Group. To assess which other retailers could benefit, in a note Wednesday the firm analyzed the proximity of the Bed Bath & Beyond locations that are closing — which span 37 states — among others. At a distance of similar home furnishing outlets. “Our data showed that Target and Walmart’s closing Bed Bath & Beyond had the largest number of stores,” said analyst Christina Fernandez. “In fact, 63% of Bed Bath & Beyond stores have targets within one mile and 85% within three miles.” TGT 1Y Mountain Target is next on the Walmart list, down nearly a quarter in the last year, as 53% of Bed Bath & Beyond stores have a Walmart within a mile, and 83% have one within three miles. TJX concept stores are next, with 37% of the soon-to-be-closing Bed Bath & Beyond stores within a mile and 54% within three miles. Of those, TJ Maxx is likely to benefit the most, as 46% of Bed Bath & Beyond stores are set to close, within a mile and 64% are within three miles of the discount retailer. Retailers such as Burlington and Ross could also see gains, according to the note. Potential Sales Lift for Retailers The main benefit to retailers from Bed Bath and Store closures will be higher sales because they attract a similar consumer base. It’s likely that the store closures will take a $750-$800 million hit to Bed Bath & Beyond’s sales, according to Telsey. As per the note, the sales may increase by around 0.05% to 0.40% on an annual basis. Telsey sees online stores Wayfair, Burlington, Ross, TJX and Target projected gains in the range of 0.20% and 0.40% on the year. For Amazon and Walmart, it is likely to be around 0.05%, Fernandez said. If all Bed Bath & Beyond stores were to close, the benefit to its competitors would be even greater, as it would lose approximately $4.3 billion in sales. Of course, some of the retailers who would potentially benefit from Bed Bath & Beyond closings are finding themselves struggling amid a potential recession, tight labor market and ongoing issues linked to the pandemic. The additional sales could serve as a lifeline were the economy to weaken further. In Target’s latest earnings release, the chain cut its fourth-quarter outlook after slowing sales. Walmart also said it is seeing a change in consumer behavior, with even wealthier shoppers searching for deals. Wayfair recently laid off 1,750 employees due to a company-wide restructuring and cost-cutting effort. Analysts applauded the move, but it was unclear whether the cost-cutting would lead to greater profitability at the discount chain. Additional sales will be welcome as Wayfair tries to become more profitable. The online retailer has spent heavily on attracting and retaining new customers. — CNBC’s Michael Bloom contributed reporting.
If Bed Bath & Beyond closes more stores, these companies could benefit the most