In the months before Bed Bath & Beyond declared bankruptcy last April, the former home goods titan was trapped in a crushing cycle. The retailer had been failing to pay its vendors on time, if at all. During the pivotal holiday season, some began requiring payment when goods were delivered or refusing orders altogether, which left Bed Bath unable to stock shelves.
Running low on cash and needing a strong holiday quarter, the retailer’s position — and in turn its relationship with vendors — only got worse. The cycle continued until the big boxer succumbed to bankruptcy, and was liquidated a few months later.
Similar dynamics accelerated the demise of other once-ubiquitous retailers, such as RadioShack and Toys R Us. While the factors that led to their downfalls varied, failing to pay vendors on time is often a sign of financial distress or an early indicator of bankruptcy risk, experts have told CNBC.
Retailers including Peloton
, Saks, Express
and Bath & Body Works
have often failed to pay their vendors on time in the last few months, according to new data from Creditsafe, a business intelligence platform that analyzes companies’ financial, legal and compliance risks.
www.cnbc.com/2024/04/04/retailers-like-peloton-saks-express-are-late-on-vendor-bills.html