Some Bed Bath & Beyond suppliers are limiting or halting shipments altogether after the home goods retailer fell behind on payments, according to people familiar with the matter, complicating the company’s struggle for liquidity.
Several of the companies that provide credit insurance or short-term financing to suppliers have revoked coverage of Bed Bath & Beyond, according to the people, who asked not to be identified and discussed private information. The Union, New Jersey-based company did not immediately respond to requests for comment.
Bed Bath & Beyond shares lost half their value this week after influential investor Ryan Cohen dumped his stake in the company. The stock extended its decline in after-hours trading on Friday, down 6.2% at 17:21 in New York.
The retailer has previously said it is struggling with cash and inventory optimisation, and ordering errors appear to have left it with a glut of items to sell for write-downs. Chief executive Mark Tritton stepped down in June, replaced on an interim basis by board member Sue Gove.
A survey of suppliers by Pulse Ratings, an independent credit rating and consulting firm, found that Bed Bath & Beyond was in arrears with all respondents, and some said more than half of their accounts receivable with the company were past due. Payments were delayed by as much as 90 days, the vendors said in the survey seen by Bloomberg.
Meanwhile, management lacks guidance on its plans to catch up on overdue bills, respondents said. The survey did not identify respondents, and Pulse Ratings declined to comment on the report.
Supply chain disruptions and weakening consumer confidence have left many retailers awash with goods after first working to build up scarce inventories.
Bed Bath & Beyond’s inventory rose more than 12% last quarter compared to a year earlier, and sales fell, according to its earnings report for the first quarter ended May 28.
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