Michigan consumers in need of linens, bath towels and other household items will have to look for products in stores other than Bed Bath & Beyond, come June of this year. The company has 13 stores in this state, most of which are in Detroit. However, ongoing financial problems have compelled the business to file for Chapter 11 bankruptcy, and it will be closing all its stores nationwide.
Bed Bath & Beyond representatives say the company is seeking a buyer, which would be the only means of keeping its doors open to the public. As it stands, all stores will close if no one purchases the company, and 14,000 workers will be out of a job. Last year, Bed Bath & Beyond employed more than twice that many people but cutbacks were made to try to resolve financial issues.
Company will continue to operate through bankruptcy process
Thanks to a loan that Bed Bath & Beyond received, the company can stay open for business while its Chapter 11 bankruptcy is processed. The loan, however, is reportedly not enough to enable the iconic retailer to stay afloat financially. Bed Bath & Beyond is one of numerous other big retail stores, such as David’s Bridal and Party City, that have filed bankruptcy petitions to overcome financial crises.
What is unique about Chapter 11 bankruptcy?
Corporations, limited liability companies and partnerships cannot continue to operate if they file for Chapter 7 bankruptcy. These same types of businesses do not qualify for Chapter 13 proceedings. Chapter 11 bankruptcy is unique because it enables businesses to remain open to the public while navigating the bankruptcy process, subject to court approval. A bankruptcy attorney can provide experienced guidance and support to anyone considering filing a claim who has questions regarding the differences between bankruptcy programs.
