Dive Brief:
- Neighborhood Intelligence, previously known as Bed Bath & Beyond, is closing its distribution center in Aberdeen, Maryland, CEO Marcus Lemonis said on an earnings call last week.
- The beleaguered retailer will move inventory from the facility to a location in Dallas while evaluating its entire supply chain “to rip out big chunks of costs,” Lemonis said. The CEO did not share details about how employees at the site would be impacted, and the company did not respond to a request for comment.
- “The good news is we're 22% under market on a per square foot basis to be able to get out of that lease and we think we actually could potentially have some arbitrage to the upside,” Lemonis said of the Aberdeen facility closure.
Dive Insight:
Lemonis’ frank statement about removing costs comes as no surprise as Neighborhood Intelligence looks to reset its turnaround strategy.
The company has eliminated $50 million in annualized SG&A costs this year and identified $40 million in additional annualized operational and merger savings, according to an earnings release. Neighborhood Intelligence expects to meet that target by consolidating its supply chain, eliminating organizational redundancies and optimizing its store fleet, the release says.
Despite the realized savings, the retailer reported a $62 million year-over-year operating loss in Q3 2026, even as revenue jumped by 98% thanks primarily to acquisitions of Kirkland’s and The Container Store, per the release.
Such acquisitions had been a key pillar of Neighborhood Intelligence’s strategy to return to profitability, but in recent months, it has nullified previous agreements to purchase F9 Brands, the owner of Cabinets To Go and Lumber Liquidators, and real estate platform Fathom Holdings.
“Over the last year, we transformed Neighborhood Intelligence by bringing together some of the most recognized brands in the home category, along with retail, manufacturing, sourcing and home service capabilities,” Lemonis said. “Now our focus changes. We are not pursuing any additional acquisitions.”
Lemonis also said that in addition to consolidating its supply chain and moving away from acquisitions, the company is “simplifying how products move through our network.”
“Along with clearing dated and underperforming inventory identified during acquisition diligence, this work is helping us build a more efficient operation and make room for the assortments customers want,” Lemonis said.
As one example, Neighborhood Intelligence is turning to artificial intelligence to help boost supply chain performance. More specifically, the retailer is unifying AI-fueled forecasting, replenishment, allocation and merchandise financial planning through a partnership with technology vendor Relex Solutions.
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