10 of the most brutal criticisms activist investors lobbed at Bed Bath & Beyond in a savage presentation

Kate TaylorApr 27, 2019, 00:28 IST

Business Insider/Jessica Tyler

Activist investors recently released a presentation slamming Bed Bath & Beyond for everything from messy stores to CEO pay.
Slide after slide of the presentation describes different parts of the company that activist investors believe to be "broken."
Here are 10 of the most brutal criticisms investors lobbed at Bed Bath & Beyond.
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Bed Bath & Beyond is under fire for messy stores, "excessive compensation" of executives, and an abundance of garbage cans.

A group of activist investors - Legion Partners, Macellum Capital Management, and Ancora Advisors - recently released a brutal presentation slamming Bed Bath & Beyond's leadership.

The 168-slide presentation takes issue with everything from executive compensation to clutter in stores' aisles. Slide after slide describes different parts of the company that activist investors say are "broken."

Bed Bath & Beyond said that it is already taking action on many of the issues highlighted by the activist investors.

"Upon our initial review, it appears that most of the operational areas targeted for improvement include actions the Company is already taking as part of its transformation plan, which are already well underway, or have been substantially completed," the company said in a statement on Friday.

"Other target areas identified include actions that have been, and continue to be, considered by Bed Bath & Beyond. The company will provide a more detailed response at the appropriate time."

Here are 10 of the most savage criticisms investors lobbed at Bed Bath & Beyond:

See 10 of the most brutal criticisms activist investors lobbed at Bed Bath & Beyond in a savage presentation >>

Many of the most brutal criticisms are focused on Bed Bath & Beyond's "poor shopping environment that is neither experiential nor curated."

The presentation also puts it more bluntly: "Stores are a mess."

The presentation describes the scene as "random assortments shoved into fixtures."

Trash cans also proved to be a major problem for investors, who described stores as "garbage cans galore."

Apparently many customers complain about clutter, with the investor group citing a proprietary survey of 682 shoppers.

One respondent reportedly said: "The aisles are often too narrow and/or overcrowded with product. I'm not a huge fan of the crowded feeling in the store, which makes me not want to spend a lot of time browsing while I'm in there."

Investors cited a Business Insider article with the headline: "Bed Bath & Beyond's stores have been slammed as 'devoid of inspiration' and 'a mess.' We went shopping there and found it completely overwhelming."

Read the full article from October 2018 here.

Stores' merchandise assortment is slammed as "weak."

Stores lack "innovation and exclusive products that can drive traffic," the presentation states.

Bed Bath & Beyond's leadership is also criticized by investors.

"Under the current CEO, the Company's operational performance is deteriorating at an accelerating pace and he must be removed immediately and replaced with a highly qualified and capable leader," the presentation says.

Executives received "Best-in-Class Pay for Worst-in-Class Performance" the presentation states.

CEO Steven Temares' base salary was $4 million in 2017, compared to rival retailers' CEO's average base pay of $1.3 million. Temares' base pay was cut to $500,000 in fiscal 2018, though the presentation notes that this wasn't a permanent change.

Investors further took issue with the board's "excessive" perks.

The company paid co-chairmen and former co-CEOs Warren Eisenberg and Leonard Feinstein, "$229,850 for car and car service allowances and $63,700 for personal tax preparation needs, respectively ... in 2017," the presentation states.

Eisenberg and Feinstein both left the company's board on Monday.

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