Bed Bath & Beyond Launches 2nd Private-Label Furnishing Brand

Bed Bath & Beyond Inc. (NASDAQ:BBBY) recently announced the launch of One Kings Lane Open House — an exclusive and luxury home furnishings brand. This is the company’s second private-label brand launched in home collection, after introducing its first in-house brand – Bee & Willow Home – earlier this year. In all, the company plans to introduce six private-label home furnishing brands by 2020.

Currently, customers can avail the collection on bedbathandbeyond.com as well as asonekingslane.com, with further releases expected through 2020. The company expects to expand the One Kings Lane Open House into stores, besides introducing other product categories, in spring 2020.

Notably, the launch of One Kings Lane Open House brings unique and tailor-made designs to the Bed Bath & Beyond customers, serving its mission of being an expert in the home furnishing space.

The One Kings Lane, acquired in 2019, houses a collection of luxury furniture and home decor pieces at convenient prices. The brand features a mix of traditional and modern styles to offer trendy and elegant assortments. It accommodates furniture and decor items from sofas and tables to mirrors, wall art, lamps and rugs, among others. The collection is priced ranging from $34.99 for decorative assortments to $1,199.99 for furniture pieces. As of Jun 1, 2019, the company had two retail stores under the label ‘One Kings Lane’.

We note that Bed Bath & Beyond offers a wide array of domestic merchandise and home furnishings. In fact, the company remains keen on improving its assortment mix to increase sales, supply chain and modifications in pricing and coupon strategy. Its consistent efforts to bring out the best solutions for offering highly differentiated and enhanced products to shoppers are added positives.

Furthermore, Bed Bath & Beyond is on track with its transformation plan, positioning the company well for success in a dynamic retail landscape. The company targets stabilizing top-line growth; resetting the cost structure; optimizing the asset base with its portfolio of retail banners; and refining the organization structure.

To adapt to the changing market conditions, the company remains focused on expanding, renovating and relocating stores. Additionally, the Next Generation Lab stores, where the company is testing various experiences and visual merchandising, are expected to boost customer experience.

Price Performance

Despite these laudable efforts, shares of this Zacks Rank #4 (Sell) company have lost 11.2% against the industry’s 6.2% growth so far this year.

This underperformance can be attributed to the company's strained margins trend. Bed Bath & Beyond is battling margin pressures for 12 straight quarters now.

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