Nearly half of Bed Bath and Beyond's products are out of stock as the retailer nears bankruptcy

• Bed Bath & Beyond had 53% of inventory available for customers in December 2022, per DataWave.
• Supply chain issues and issues paying suppliers have created the inventory problem, analysts say.
• The company said Thursday it has "substantial doubts" it can continue and is considering bankruptcy.

Bed Bath & Beyond has run into another major problem as it weighs filing for bankruptcy: It is out of nearly half of its products to sell to customers.

The New-Jersey-based company's inventory availability rate, or the number of items available for customer orders, was at 53% by the end of December 2022, according to data from DataWeave, a retail data and pricing analytics firm. For context, in January 2022, the company's inventory availability rate was 77%.

That's much lower than the company's competitors like Kohl's and Lowe's, whose December 2022 inventory availability rates were 61% and 72%, respectively.

Analysts say supply chain issues with private label brands and issues paying suppliers have contributed to this lack of inventory.

The lack of inventory puts Bed Bath and Beyond in a major quagmire: It wants to bring back national brand products to improve performance, but it has a limited supply of products to offer. Continued declining sales could push the company into bankruptcy.

"During the quarter, inventory levels were negatively impacted by reduced credit limits for Bed Bath," Raymond James analyst Bobby Griffin wrote in a note Thursday. "While management noted in the release that it leveraged the liquidity gained from the holiday season to pursue higher in-stock levels, the challenged inventory position is troubling given part of the near-term strategy to improve performance is to bring back national brand products."

These inventory issues come as Bed Bath and Beyond started 2023 on a tumult ous note, writing in an SEC filing Thursday that it had "substantial doubt" it could continue running the business. The threat of bankruptcy comes months after the company said it would slash 20% of corporate jobs and close 150 stores. In May, the company's board pushed out CEO Mark Tritton, who advocated for limited inventory and a focus on private-label brands. The company, under its new CEO Sue Gove, has tried to reverse course.

Categories worse off for Bed Bath and Beyond in December 2022 were kitchen and lighting, which both had a mere 39% inventory availability rate. The company's strongest category from an inventory standpoint was home décor, which had an availability rate of 66%.

While the company's six major categories, including bathroom, bedding, and furniture and storage, all saw dips in inventory from the start of 2022, there is a "silver lining," according to Krish Thyagarajan, DataWeave president and COO. Bedding, bathroom, and home décor all saw slight upticks in inventory availability in December 2022 compared to the month prior.

"These three are critical categories, and if they can sustain the trend, perhaps calendar Q1 can be better," Thyagarajan told Insider. "We'll know more by the end of this quarter or next quarter if they've managed to turn the tide."

Do you work for Bed Bath & Beyond and have noticed stocking issues? Contact reporter Ben Tobin by email at btobin@insider.com or on Signal at +1 703-498-9171