Inside Bed Bath & Beyond Home’s growth strategy

The first Bed Bath & Beyond Home store opened in Nashville last month, a new beginning for legacy retail brand Bed Bath & Beyond, which filed for bankruptcy in 2023 but later re-emerged as an online retailer.

The Brand House Collective partnered with the company last year to become the exclusive brick-and-mortar operator and licensee for smaller format Bed Bath & Beyond locations nationwide. And both companies changed their names this year: Beyond Inc. became Bed Bath & Beyond last month while Kirkland’s rebranded as the Brand House Collective in June.

On opening day at the Nashville store, customers waited in line for three hours, many with years-old Bed Bath & Beyond coupons in hand, to get a peek at the new store, and the opening generated record-breaking year-over-year sales for what was previously a Kirkland’s store, CEO Amy Sullivan told Home Accents Today.

The store will test its assortment but is focusing on Bed Bath & Beyond’s historical strength in bed, bath and kitchen products. It carries 30 national brand partners such as Cuisinart and Nicole Miller. “We know they are in wide distribution elsewhere, but the curation at the store validated that the customer wants an ‘A’ location where the inventory is always in stock,” Sullivan said.

The store also carries seasonal décor, traditionally a sweet spot for Kirkland’s customers. Those customers also look for holiday products, decorative accents and textiles, Sullivan said.

It is Sullivan’s responsibility to shepherd the growth of this new endeavor while also stabilizing and strengthening the Kirkland nameplate, keeping its customers in the fold.

“I’ve really tried to reengage the Kirkland’s customer,” said Sullivan. “It was a little off track. The brand was struggling. I want to make sure the legacy Kirkland customer sees the legacy in seasonal and decor. The fact that we’re keeping 40-50% of the best of the best Kirkland’s product in the store is the story we have to tell.”

Meanwhile, Bed Bath & Beyond is returning after bankruptcy, so Sullivan will also need to prove to its customers that it’s not the same old store. Sullivan said the trick will be doing so in a responsible way, including “buying the right inventory, but not too much.”

The store conversion was a $30,000 investment, according to Sullivan. The Brand House Collective kept the existing Kirkland’s fixtures and changed the sign above the door, but that was about it in terms of the physical property. “Being capital-light enables us to do more faster,” Sullivan said.

The real estate is smaller and designed to feel like your neighborhood store, she noted. “Everything is intentional. We are not building million-dollar stores or stacking to the ceiling. I think this neighborhood [store] can partner with the community. As we pilot in Nashville, we will go store by store, market by market, so it feels like your neighborhood store. It is the best of Bed Bath & Beyond without the giant store.”

Long-term, the goal is for Bed Bath customers to shop the brick-and-mortar store and then go online for additional product options. “So the store is driving the core assortment, and the website is the ‘endless aisles’ side of it,” Sullivan said.

Then there’s the coupon. Customers were encouraged to bring in their legacy Bed Bath & Beyond coupons to the new store opening. “The coupon we all know and love is back and for those who need one, a fresh version will be waiting at the door,” The Brand House Collective said in a release announcing the new store opening. One customer brought a coupon from 2012.

In an interview, Sullivan acknowledged the risk of couponing and training customers to always look for a sale.

“We want everyday value you can trust. But there is magic to that coupon,” she said. The coupon may draw the customer in, but the sales strategy lies in the brands, she added.

“We will think through the appropriate distribution,” she said. “We are exploring direct mail … We want to bring it back to life, keep the hype going, but we will be methodical about it.”

On the Nashville store’s opening day, Sullivan circulated around the store for six hours, talking to customers and letting them know that she stood behind the product assortment. They are also planning a monthly ‘Ask Amy’ bit on Instagram.

“I wanted to assure customers we are building this brand for both companies to coexist,” she said. “I chatted with them for hours. We have to figure out how to keep that going, and keep all customers involved in how that plays out over next months and years.”

Five additional stores — all Kirkland’s conversions — will open in Nashville by mid-November, and Sullivan plans to convert the vast majority of stores over the next 24 months. Success will be measured in customer acquisition and revenue growth, and ultimately in attracting a new generation unfamiliar with Bed Bath & Beyond’s back-to-campus offerings.

“We want to get to everyone’s hometown as quickly as we can,” Sullivan said.