Bed Bath & Beyond Inc. will open two new regional distribution centers as part of a $250 million supply chain transformation.
The home goods chain is partnering with third-party logistics provider Ryder System Inc. to develop and operate two regional distribution centers as part of a larger $250 million investment in supply chain transformation announced in October 2020. The company expects to invest about $250 million during next three years to reinvent its supply chain, and pivot from a consolidation-based model to a modernized distribution network that is faster, more competitive and responsive to the market.
By opening the two new regional hubs, the retailer intends to reduce product replenishment times to Bed Bath & Beyond and buybuy Baby stores to less than 10 days from the current 35 days.
Bed Bath & Beyond selected Ryder from a competitive request for proposal process that began in 2020. The first regional distribution center will be a one-million-square-foot modern facility, with the potential for expansion, located in Frackville, Pa. It will provide merchandise to stores throughout the Northeast for both in-store shopping and online shopping services such as buy online pickup in store or curbside, same day delivery, and ship from store.
This regional distribution center will open in fall 2021, and Ryder will then open a similar facility in 2022, in Southern California. These two new facilities are expected to each create 300 new jobs in their local communities.
Other recent Bed Bath & Beyond investments to modernize its operations as part of a company-wide transformation strategy include the selection of Oracle as its ERP technology provider and selection of Relex Solutions to provide real-time visibility into the supply chain.
Bed Bath & Beyond intends these added technology solutions to enable the tracking of merchandise and products stored and distributed by its new regional distribution centers, enabling greater efficiencies and capabilities to plan and forecast product replenishment to improve in-stock positions and speed to market.
Additional elements of Bed Bath & Beyond executing against its transformation include launching six private brands ahead of schedule, re-opening its newly redesigned flagship store emblematic of a plan to remodel 450 stores, and introducing a new brand positioning.
"When we first started talking with Bed Bath & Beyond about its omni-always strategy, we knew our two companies would be a great fit," said Steve Sensing, president of global supply chain solutions for Ryder. "We share the same steadfast commitment to providing an elevated customer experience; and, in today's environment, that means meeting consumers where, when, and how they choose to engage. Ryder helps brands do just that, so our customers can focus on their core business."
"The modernization of our supply chain is one of our core operational transformation initiatives to create greater efficiencies and reduce 'out of stock' occurrences for our customers," said John Hartmann, COO for Bed Bath & Beyond and president of buybuy Baby. "As we provide our customers with an omni-always shopping environment, it is imperative for our growth to invest in our supply chain to ensure that we are meeting the needs of the business and our valued customers. Ryder is a clear leader in logistics, and we look forward to leaning on their expertise and capabilities to help modernize our supply chain and distribution network operations."