Does Vegas have a betting line on which company will next abandon California? Maybe it should. But then the field of possibilities is just too large to fit them all on a casino board.
Following a business plan that has worked for so many others, Bed, Bad & Beyond is the latest company to announce that it is giving up on the state because it’s no longer worth the effort to do business here.
“We will not open or operate retail stores in California,” Marcus Lemonis, executive chairman of Bed Bath & Beyond, said in a company statement.
Not that long ago, in 2022, the chain had 87 stores in California, the most in any state. Soon thereafter came bankruptcy, closures of all of its stores, and eventually a reshuffling of executives that left Lemonis in charge. The chain plans to open 300 new stores, but none in California.
Lemonis, who has a history of building businesses, says the “decision isn’t about politics – it’s about reality. California has created one of the most overregulated, expensive, and risky environments for businesses in America. It’s a system that makes it harder to employ people, harder to keep doors open, and harder to deliver value to customers.”
Californians will still be able to shop online at Bed, Bath & Beyond. Meanwhile, the chain will “have stores in almost every other state.”
Lemonis cited – as do so many of the other businesses that skip the state – steep taxes, “higher fees” and “wages that many businesses simply cannot sustain, and endless regulations that strangle growth.” He could have also mentioned the wave of retail theft that forced some stores to lock their goods in cases and others to surrender and close their doors.
Earlier this year, he called Senate Bill 253 a “crazy law” that requires stores in his Camping World chain to “write down every company vehicle, where it drove, how many miles it drove, how often the golf carts are being used, because there’s this idea that we’re emitting gases into the environment.”
“Asking me to hire more people to keep track of where the truck went to deliver a part is just a good example, a small example, of why things got more expensive,” he added. “When you regulate businesses to the point where they have to add layers of expense, and they still need to maintain profitability, you have essentially created inflation to regulation.”
How many more times do lawmakers have to hear a similar complaint before they make the significant changes?
Or could it be that things are exactly as they want them to be and have no interest in adjusting?
The retort from Gov. Gavin Newsom’s messaging team indicates the latter.
“After their bankruptcy and closure of every store, like most Americans, we thought Bed, Bath & Beyond no longer existed. We wish them well in their efforts to become relevant again as they try to open a 2nd store,” Newsom’s spokespeople posted on X.
The response from Newsom himself was a bit less snarky – but not by much. It also showed how oblivious California policymakers are to the damage they’ve done to the state.
“The company that already went bankrupt and closed every store across the country two years ago? Ok.”
Lemonis, also a Democratic politician, tried to take the heat down a bit.
“You are a smart man and I know (your post on X) is out of frustration,” he said.
Lemonis was hoping that rather than tossing around insults, Newsom instead was going to use his platform to “suggest we bring business leaders together to understand how to improve” California’s business environment. He then laid out the basics for the governor: streamline regulation and compliance rules; balance the employee-employer environment (which is heavily weighted in favor of employees at the expense of employers); reform tort laws to cut back on lawsuit abuse; and craft a tax-and-cost structure that is competitive with other states and will attract business and investment.
At one time, California was a haven for innovators, visionaries, capital and hard work. But it’s become quite the snake pit for both businesses and residents, and it’s reached the point where it’s too easy to think that’s never going to change, which means a course correction is long overdue.
