Bed Bath & Beyond Inc. executives told suppliers on a video conference call yesterday that the company would pay them in advance for their merchandise or upon delivery, part of the retailer’s effort to win over skittish manufacturers and put the troubled business back on track, Bloomberg News reported. Executives told suppliers that they intend to use funds from a recent equity offering to get more products into the company’s stores. Shelves have been sparse because Bed Bath & Beyond has struggled to pay manufacturers. But the impact won’t be immediate, interim Chief Financial Officer Holly Etlin told suppliers. The home-goods retailer secured an equity offering last week that will potentially allow it to raise as much as $1 billion over time. “While we think that that will be the necessary funding to fund the turnaround, it isn’t all here right now,” Etlin said. “It came in — a small amount up front — and then $100 million a month over the next few months until we get up to the committed amount.” The equity deal is underpinned by anchor investor Hudson Bay Capital Management, a New York-based hedge fund. Bed Bath & Beyond is “prepared to pay” cash in advance or on delivery to suppliers to convince them to sell their products to the retailer, Etlin said during the presentation. Suppliers have been demanding upfront payments for months because they were concerned about not being paid for their goods. But the company — short on cash — hasn’t been able to meet those requests, so many suppliers limited or halted their shipments. “We don’t expect you to come forward immediately, but we hope that we will ultimately restore your trust in us,” said Etlin, a restructuring expert at consulting firm AlixPartners who joined Bed Bath & Beyond last week on a temporary basis.
