Bed Bath & Beyond-and baby necessities? What does this retailer’s new partnership mean? Variegated fool

2021-12-13 15:38:17 By : Ms. Yao Tom

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Investors in Bed Bath & Beyond (BBBY -3.16%) have experienced quite volatile years. Although there have been some highs throughout 2021, the retail giant's share price is still only about half of what it was five years ago.

But it's not just shareholders who need to worry about Bed Bath & Beyond. If the backbone of the shopping center continues to decline, it may have a cruel impact on real estate investors.

Fortunately, Bed Bath & Beyond is taking steps to remain relevant and competitive. Recently, it announced a partnership with Uber (UBER -2.07%) to provide baby necessities to desperate parents in need. If it can solve this corner of the market, then by 2022, the company's prospects may change in a very positive way.

The baby’s parents are always exhausted and sleep deprived, so the idea of ​​having to leave home to find supplements can be daunting.

Enter Bed Bath & Beyond. Now, the retail giant is working with Uber to launch a vertical service for children on the Uber Eats app. Customers can choose to order a wide range of products, from diapers to wipes to first aid supplies, and deliver them on demand.

Although Bed Bath & Beyond has more than 750 stores of the same name in the United States, its buybuy BABY stores are more limited and scattered, with only about 120 stores nationwide. Therefore, parents who cannot enter these stores may be more willing to provide baby products, especially considering the competitive price point of Bed Bath & Beyond.

Compared with retailers such as Wal-Mart (WMT -0.23%) and Target (TGT -1.32%), Bed Bath & Beyond has long been dwarfed in transportation and delivery. In response to the pandemic, both giants have stepped up their efforts, offering a series of options designed to support online orders. These include same-day delivery, expedited delivery, and BOPIS, or online purchase and store pickup.

In order to remain competitive in the field of baby care, Bed Bath & Beyond needs to provide consumers with the same level of speed and convenience. Its partnership with Uber may be a ticket to obtain additional revenue from spectators who are particularly in need.

Given the large number of stores closed during the pandemic, the most unbearable thing for real estate investors is to lose a large company like Bed Bath & Beyond, which often acts as the main tenant of a shopping center. If Bed Bath & Beyond’s latest joint venture takes off, it can ensure its long-term tenant status, so commercial landlords don’t have to worry.

In addition to its partnership with Uber, Bed Bath & Beyond also partnered with supermarket giant Kroger (Kroger 0.83%) to provide some of its products in selected grocery stores and Kroger.com.

All in all, it is clear that Bed Bath & Beyond realizes that it needs to expand its business if it wants to maintain the viability of the retail sector for many years to come.

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