Businessmodel of Bed Bath and Beyond

Customer Segments

Bed Bath and Beyond serves a broad customer base, selling a wide range of domestic and products and home furnishings. The Company’s customers can be organised broadly into two core categories:

• Retail Customers, comprising general consumers across multiple customer demographics that purchase products via the Company’s retail channels; and
• Institutional Customers, comprising various institutional and commercial entities, principally companies within the hospitality, foodservice, and healthcare industries, including restaurants, cruise lines, and hospitals. Bed Bath and Beyond serves an extensive customer base across North America. The Company operates retail outlets across all 50 US states, as well as in Puerto Rico and across Canada.

Value Propositions

Bed Bath and Beyond provides value to its customers in the following ways:

• Its brand strength and reputation, with the Company established as one of the most popular and recognisable outlets for homeware and furnishings across North America, offering a number of high-quality products and proprietary brands;
• Its breadth of its product portfolio, with the Company offering its customers an extensive range of products, including bedding, kitchenware, home furnishings, furniture, and home décor products;
• Its accessibility, with the Company making its products and services easily accessible to customers across north America, operating an extensive network of retail outlets, as well as operating an online retail store and dedicated institutional sales force; and
• Its extensive distribution infrastructure, with the Company operating a robust distribution infrastructure, comprising proprietary and third party facilities, enabling the Company to efficiently deliver products to its stores and to its customers. ### Channels

Bed Bath and Beyond operates a website at www.bedbathandbeyond.com through which it provides information on its product lines, brands, and outlet locations. The Company’s website also doubles as an online retail channel, which allows customers to browse products, make purchases, and arrange deliveries directly. The Company also offers its customers a mobile app, available on iOS and Android devices, through which they can access deals and coupons, as well as make purchases.

Bed Bath and Beyond principally serves its customers directly through its network of physical retail outlets across North America. The Company employs a dedicated team of in-store sales personnel who can serve customers in person. Bed Bath and Beyond also operates a dedicated sales force across its office network through which it serves various commercial and institutional clients.

Bed Bath and Beyond operates its own distribution network, as well as utilising various third party facilities, including cross dock locations and distribution facilities which are primarily located throughout the US. Shipments are also made to customers by contract carriers depending upon location.

Customer Relationships

Bed Bath and Beyond makes many of its products available to clients through its online retail channel, which enables customers to browse products, make purchase, track deliveries, and manage account details without interacting directly with members of the Company’s sales and support personnel. The Company’s mobile app offers similar self-service functionality.

Bed Bath and Beyond makes the bulk of its sales through its physical retail outlets, with in-store sales personnel assisting customers directly with enquiries and queries, and directly handling complaints and product returns. The Company also seeks to provide a tailored service to its institutional customers, with dedicated sales personnel consulting closely with these customers to fulfil the individual requirements of each contract.

Bed Bath and Beyond operates a customer support organisation, the members of which can be contacted by customers over the phone or via email, and are able to provide personalised responses to enquiries and complaints. The Company also offers a range of support resources to customers via its website, including shipping information, FAQs, and product recall information.

Customers are additionally able to follow Bed Bath and Beyond’s activities and interact with the Company directly through its social media accounts, including with Facebook, Twitter, Pinterest, and Instagram.

Key Activities

Bed Bath and Beyond operates as a retailer of homeware and furnishings, under the brand names Bed Bath and Beyond, Christmas Tree Shops, Harmon or Harmon Face Values, buybuy BABY and World Market, and Cost Plus World Market.

The Company aligns its operations into two operating segments: North American Retail, which comprises the Company’s core retail operations across the US and Canada; and Institutional Sales, which comprises the Company’s sales of linens and textile products to customers across the healthcare, hospitality, and foodservice industries.

The Company sells a range of domestic merchandise and home furnishings, including bed linens and related items, bath items and kitchen textiles, kitchen and tabletop items, basic housewares, general home furnishings, and consumables. The Company operates more than 1,500 retail outlets across North America, as well as an online sales channel.

Key Partners

Bed Bath and Beyond works closely with a network of partner companies and organisations to ensure that it provides its customers with high-quality products and services. These partners can be organised broadly into the following categories:

• Supplier and Vendor Partners, comprising suppliers of products and merchandise that is sold across the Company’s various sales channels, as well as suppliers of services, technologies, and equipment that are utilised more broadly across the Company;
• Channel and Distribution Partners, principally comprising distribution service providers and courier service providers that assist the Company in operating its distribution infrastructure and fulfilling customer deliveries;
• Social and Community Partners, comprising a range of charitable organisations and non-profits with which the Company collaborates on social and community projects, primarily across North America; and
• Strategic and Alliance Partners, comprising various market leading companies across multiple sectors, with which the Company works on joint projects in branding and marketing. Bed Bath and Beyond is additionally a partner in a joint venture which operates seven retail stores in Mexico under the name Bed Bath and Beyond.

Bed Bath and beyond has a number of partnerships in place. This includes a retail partnership with University Campus Store, a broad partnership with Destination Maternity Corporation, and a branding partnership with Atlantis, Paradise Island.

Key Resources

Bed Bath and Beyond’s key resources are its products and merchandise, its supply chain, its online store and website, its IT and communications infrastructure, its network of physical retail outlets, its storage and distribution infrastructure, its partnerships, and its personnel.

Bed Bath and Beyond owns a number of intellectual properties that are key to its operations. This notably includes a number proprietary brands such as Bed Bath and Beyond, buybuy BABY, Christmas Tree Shops, andThat!, Harmon, Face Values, Cost Plus, World Market, Cost Plus World Market, and Of a Kind. The Company also files patent applications and seeks copyright registrations where it considers such protections to be advantageous.

Bed Bath and beyond also owns and or leases a portfolio of properties across North America. This notably includes the Company’s network of more than 1,500 retail outlets, as well as its distribution centres and other facilities.

Cost Structure

Bed Bath and Beyond incurs costs in relation to the development of its intellectual properties, the procurement of products and services, the development and maintenance of its online sales channel, the maintenance of its IT and communications infrastructure, the operation of its distribution and storage facilities, the implementation of advertising and marketing campaigns, the management of its partnerships, and the retention of its personnel.

In 2015 Bed Bath and beyond recorded total cost of sales for the year of $7.48 billion, and selling, general, and administrative costs in the amount of $3.21 billion.

Revenue Streams

Bed Bath and beyond generates revenue through the sale of various homeware and home furnishing products across its retail outlets and online store, as well as the sale of linens and other textile products to institutional customers in the healthcare, hospitality, and foodservice industries.

In 2015 Bed Bath and Beyond generated annual net sales in the amount of $12.10 billion, up on the $11.88 billion recorded by the Company in 2014. The Company’s Retail North America segment accounted for the vast majority of the Company’s sales for the year.