Bed Bath & Beyond is turning to franchising to help drive the expansion of its reborn store fleet.
The Murray, Utah-based company — owner of the Bed Bath & Beyond, Buy Buy Baby and Overstock brands — on Tuesday said it plans to launch a national franchise system, working with local entrepreneurs.
“Our goal is to grow Bed Bath & Beyond in the most capital efficient manner,” Marcus Lemonis, executive chairman of the company, said in a statement. “This system enables local owners to deliver personal service and local flavor while leveraging our national infrastructure, marketing and technology.”
The franchise model will enable Bed Bath & Beyond “to operate a smaller footprint of corporate stores nationwide while a complementary franchise network extends its reach,” according to the company. Franchisees, in turn, will reap the benefits of having the systems — like inventory control and data gathering — of a national retailer at their disposal.
Whether the plan attracts interest from potential franchisees remains to be seen.
Bed Bath & Beyond is attempting to resurrect both Bed Bath & Beyond and Buy Buy Baby. All of the two chains’ stores were closed in 2023 after their then-parent filed for bankruptcy protection and liquidated. Bed Bath & Beyond has teamed up with Brand House Collective, once known as Kirkland’s, for the revival.
Most of the 309 Kirkland’s Home stores will be converted to Bed Bath & Beyond Home locations over the next 24 months. The first conversion took place at a Kirkland’s store at 1624 Galleria Blvd. in Brentwood, Tennessee, this summer. Five more Bed Bath & Beyond Home stores are slated to open in the greater Nashville market this year, and the first Buy Buy Baby store is scheduled to debut in fiscal 2026. But Bed Bath & Beyond wants to augment its company-operated store fleet.
Ikea’s franchise strategy
It’s somewhat unusual but not unknown for a retailer such as Bed Bath & Beyond to offer franchises. Swedish-based global retail giant Ikea operates under a franchise system, for example, according to Neil Saunders, a retail analyst and managing director at analytics firm GlobalData.
All the Ikea stores — with the exception of the Ikea Delft store in the Netherlands, which is owned by Inter Ikea Systems — are run under franchise agreements, according to the retailer’s website. Inter Ikea Systems is the owner of the Ikea concept and worldwide Ikea franchisor.
“Franchising is an asset-light way for Beyond to try and revitalize the Bed Bath & Beyond brand through opening more stores,” Saunders said in an email to CoStar News. “However, it does not answer or address the central question of whether the proposition is relevant or good enough for franchisees to make a successful business out of. The jury is still out on that, and I am not sure Beyond has set out a clear enough vision. It will be interesting to see how much uptake the company gets from potential franchisees and how they operate the franchise operation as they start to scale up.”
Bed Bath & Beyond didn’t respond to an email from CoStar News seeking a response to Saunders’ remarks.
Adding local flavor
Bed Bath & Beyond franchise locations will have turnkey formats of the chain’s traditional stores — including home, kitchen living, storage and organization, and holiday shop sections — “designed with a neighborhood feel,” according to the company.
Roughly 80% of each store’s merchandise assortment will be curated by Bed Bath & Beyond, with 20% localized by franchisees to spotlight regional products and designers.
“Franchisees will also share in the economics of BedBathandBeyond.com, unifying in-store and online customer experiences under one iconic brand,” according to Bed Bath & Beyond.
In addition, franchisees will have access to Bed Bath & Beyond’s AI-powered tools and data analytics capabilities, enabling those owners to forecast demand, manage inventory and optimize merchandising and staffing decisions.
“This approach ensures that every franchise owner operates with the same intelligence and agility as a national retailer, while still maintaining local authenticity,” Bed Bath & Beyond said.
For the record
The team working on the foray will be led by Ron Taylor, vice president of franchise development. He is collaborating with Amy Sullivan from the Retail Omnichannel Organization; Tom Spadea, co-founder of Spadea Lignana Franchise Attorneys; and Brian Luciani, chief growth officer at SMB Franchise Advisors.