Dive Brief:

  • S&P Global Ratings on Wednesday lowered its issuer credit rating on Bed Bath & Beyond to BB+ from BBB-; the outlook is negative, according to a press release from S&P emailed to Retail Dive.

  • The retailer’s highly promotional stance and the growing expense of its omnichannel services are likely to vex the company in the next 12 to 24 months, S&P said. “We believe the company’s competitive position has eroded, as measured by a cumulative double-digit decline in EBITDA and 530 basis points (bps) of erosion in margins over the last two years.”

  • Earlier this month, Moody’s lowered the retailer’s senior unsecured notes rating one notch to ‘Baa3’ and revised its outlook to stable from negative; the move reflected “a significant decline in Q2 gross margin driven by higher couponing, lower merchandise margin and higher e-commerce shipping costs,” according to a Wells Fargo news brief emailed to Retail Dive.

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Dive Insight:

Bed Bath & Beyond has struggled to sell goods that can…