What’s the story?
- The Container Store locations will be converted into a hybrid format blending general merchandise with custom design services, with a goal of lifting sales per square foot from $220 to $500 within 24 months.
- Kirkland’s Home store count could be reduced from 240 to as few as 210 locations after the company paused conversions to Bed Bath & Beyond Home small-format stores.
- BBB Inc. plans to aggressively deploy AI across supply chain, IT, accounting, marketing and merchandising, resulting in significant corporate headcount reductions.
- CEO Marcus Lemonis is targeting roughly $5 billion in total revenue, up from $1 billion in 2025, by combining e-commerce, acquisitions and home services into an Everything Home ecosystem.
Murray, Utah – While Bed Bath & Beyond Inc. is working to expand its footprint as a provider of “Everything Home,” it is also revamping the retail businesses in its portfolio.
During yesterday evening’s Q1 review call with financial analysts, executive chairman and CEO Marcus Lemonis described multiple initiatives that are now underway. Here are 5 key take-aways from the converstion.
The Container Store/Bed Bath & Beyond hybrid conversion
The 100 Container Stores locations the company is now in the process of acquiring will not be laid out as a split-screen format with Bed Bath & Beyond’s assortment on one side and The Container Store’s goods on the other.
Instead, Lemonis said, the hybrid The Container Store + Bed Bath & Beyond concept will offer general merchandise in one area of the store – consisting of storage, organization, kitchen, bath, bedroom, a small assortment of décor, and seasonal impulse items.
The rest of the floor will be dedicated to custom and design, including Elfa and Closet Works along with higher-end Gracious Home Cabinetry and Gracious Home Flooring. As BBB Inc. acquires more home-related services, Lemonis also envisions the store providing title closing services on site.
See also: Gracious Home sold to Bed Bath & Beyond Inc. as part of F9 transaction
The company’s goal is to take the format’s sales per square foot from $220 to $500 within 24 months, Lemonis said.
The key: properly balancing general merchandise and home services revenues.
“The blended margin of general merchandise should be in the 35% to 37% range, and the blended margin of the home services business is north of 60%,” he told investors. Longer range, Lemonis would like to raise the sales per square foot to $615.
Kirkland’s Home
Until recently, Kirkland’s Home was set to convert all of its locations into Bed Bath & Beyond Home small-format stores. After a handful of remodels, that activity has stalled.
“The reason that we slowed our pace down of converting many of them to Bed Bath & Beyond Home stores is as we looked at the numbers, we just didn’t feel like we had all of the categories that we needed,” said Lemonis.
Kirkland’s store count is now 240 stores, down from 300. That may drop to 210 units, he said.
Ultimately, the company will operate about 100 small-format Bed Bath & Beyond stores in addition to the 100 larger format The Container Store + Bed Bath & Beyond locations, he said.
Overstock “has the most potential to be a massive brand again,” Lemonis told investors. The merchandise focus continues to be patio, rugs and furniture “with an eyedropper of fashion luxury,” according to Amy Sullivan, who earlier this month was promoted to president of Bed Bath & Beyond Inc.
However, Lemonis sees a bigger role for high-ticket goods such as Rolex watches and Gucci handbags. By the end of the year, the site will be selling automobiles “and anything else that we believe fits into the four corners of the property and the four walls of the house” via third-parties on Overstock’s marketplace.
AI layoffs
In its quest to drive down overhead, BBB Inc. plans to aggressively embrace AI across its operations, leading to a significant reduction in headcount. Areas affected will include supply chain, IT, accounting, marketing and merchandising, Lemonis said.
In some cases, eliminated positions will be redeployed elsewhere – a strategy he described as pushing payroll out of corporate offices and warehouses and putting them into areas that generate revenue.
“Customer service does not have enough [employees] to my liking,” he explained. “The amount of qualified, trained staff in the stores, upselling customers, designing for customers, servicing their home for customers is not enough. We are going to become an organization that puts its payroll in the field.”
The big picture
By creating an Everything Home ecosystem across retailing, services and data integration, the BBB Inc. aims to hit around $5 billion in revenue, a steep climb from the $1 billion it generated in 2025 – most of which came from its e-commerce retail sales.
By combining recent acquisitions with legacy business – The Container Store, Bed Bath & Beyond, Overstock, Lumber Liquidators, Cabinets To Go, Elfa, Closet Works, among them – “we’re starting to dance in the $2-plus plus-plus billion range,” said Lemonis. Revenue from the core e-commerce business is expected to grow in the low to mid-single-digits.
The Kirkland’s business on an annualized basis comes in at around $325 to $350 million, he told investors. The Lumber Liquidators and Cabinets To Go businesses should add another $500 million. A renovation and installation business the company is in talks with could generate around $60 million. BBB Inc. is also in active discussions for brokerage and mortgage business.
“[Retail] brands trying to stand on their own – never going to work,” Lemonis told investors. “Brands trying to stand inside of a simple, flatter ecosystem, we think that’s ultimately why this matters.”
