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Retail Flounders, Layoffs Expected Amid Bed Bath and Beyond Bankruptcy

The retail giant Bed, Bath, and Beyond recently announced plans to declare bankruptcy after a protracted buyback of their own stock when seriously awry. In this schema, investors were paid back for their investments while workers were unceremoniously laid off, leaving many with a bitter taste in their mouths. Now, Bed, Bath, and Beyond is in bankruptcy, the workers are out of a job, but investors were made whole after the buyback.

Today, Bed, Bath, and Beyond is in bankruptcy, creating a chain reaction that could impact its vendors who rely on Bed, Bath, and Beyond’s retail outlet for commerce.

What’s next?

Generally speaking, when a company in this much turmoil files for bankruptcy, a fire sale of its assets ensues. That appears to be the most likely outcome for Bed, Bath, and Beyond, and it will not necessarily depend on the type of bankruptcy they file. 

Much like Chapter 7 for individuals, Chapter 7 for companies allows the company to divest itself against its assets to repay creditors. In most cases, the creditors get pennies on the dollar, but Bed Bath and Beyond does have some assets that it can sell off. If Bed Bath and Beyond files under Chapter 11, there may be some effort in place to save the company, but it remains unclear what a saved Bed Bath and Beyond would look like.

Ultimately, the company is floundering because of COVID and related pressures that have more Americans ordering online than ever before. Instant gratification simply is not enough to justify spending more money. 

Will workers soon follow their employer?

Bed, Bath, and Beyond is a major retailer that employs a lot of people across American malls and shopping plazas. It is likely that at least some of the individuals who currently work for the company will not be able to keep up with expenses. Our economy is at a fragile moment, with inflation acting as a passive tax that is driving up the cost of everything. 

The economy is made of people

Recent polls suggest that 60% of Americans are one missed paycheck away from bankruptcy. While Americans have done well to keep themselves afloat, any trigger can put them behind the 8-ball with no place left to go other than a bankruptcy lawyer. While bankruptcies are generally caused by fiscal mistakes, that’s no longer the case in modern America. Today, bankruptcy could simply be the product of overall market pressures creating a domino effect that impacts your finances too. It is likely that the Bed Bath and Beyond bankruptcy will lead to consumer bankruptcies in some households.

Talk to an Indiana Bankruptcy Lawyer Today

Chris Arrington represents the interests of Indiana residents filing bankruptcy. Call today to schedule a free consultation and learn more about how we can help. 

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