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Bed Bath and Beyond went bankrupt in 2023. They shut down every store and turned into a meme stock. But now Marco Simonis, the guy from the profit, is bringing them back to life. But instead of rebuilding corporate stores, they are franchising the brand, which means that you could own one. So will franchisees actually make money or are they destined to fail? Here's what you need to know. First, a little history. Bed, Bath and Beyond was the go to home goods store for decades in the US at its peak, 1500 locations, $12 billion in revenue. I remember many trips during my early years at college to outfit my do to buy, you know, bed sheets and all the little knickknacks that you need around the house. Then overnight it fell apart. So they got crushed by E commerce. Amazon cut them on price and convenience. Target, Walmart beat them on merchandising and private label. And inside the company they just made a ton of mistakes. They bloated inventory, too much inventory. They had poor online presence. They had all this debt that was used to like buy back shares and just tons and tons of mistakes. And company went bankrupt, wiped out shareholders. Overstock.com then came in during the bankruptcy and bought the name and the trademark, which was the most valuable thing they had for $21 million. And then overstock.com rebranded itself with their new name, Bed Bath and Beyond, and now are starting this rebuild process. They actually even have the old BBBY stock ticker if you're interested in investing in them. They bring in Marcus Amodes. He was the guy who had the show the Profit on MSNBC for many years. One of my favorite shows. He'd go in there and like help turn around these businesses. He'd invested them and you know, as an entrepreneur, it's really cool to like see that in action. They bring him in and he says, hey, instead of corporate stores, which cost a ton of money and time and risk, we are going to do this the other way, which is through franchising. And honestly, it's a bold shift. And on paper it's a really good solution because franchising allows them to go faster without tying up their own money, which they don't have that much of. And they don't have to worry about managing thousands and thousands employees and finding all this real estate and do all these constructions. A lot of that gets shifts to the local franchisees. Like me, I'm a franchisee with Midas. I have 35 locations. I'm the one that has to go out and shoulder that. But then as A franchisee. I get to leverage the national name, the systems. The technology for Bed Bath beyond franchising means they can grow way faster with tying up their time, people and resources to get this thing up to speed as fast as they can. And for franchisees, it's a chance to leverage a national recognized name with systems, technology, suppliers. All this stuff would take years to build from scratch that they're going to have on day one. Let's see where this is a smart move and where it could break. First let's talk about the things that went wrong and what is going to have to be different this time. The old Bed Bath and Beyond had massive, massive stores. 2030,000 square foot, super high rent, high overhead. And the new model here is going to be much smaller, much leaner, smaller footprint stores, 7 to 10,000 square feet. And they're going to have local operators. Like a franchisee cares way more than any corporate employee. You know, I'm a franchisee with 35 Midas Auto Repair shops. My stores do really well because I care very deeply about the customer experience. Because when my neighbors and friends, the people I know, go to a Midas and they know I own it, there's more, way more pressure on me. And so I want to make sure that we do a great job before slow decision making, big corporate, right, lots of bureaucracy. But with franchisees, the buck stops with the franchise owner. Like I make every decision and real time data. And the franchise community is going to be so much better to go this route then you get into inventory. Now I think this is going to be one of the biggest make or break opportunities for Marcus and the team is that this is an inventory business. And for franchisees who are putting up cash to have product on the shelf, the only way they make money is that that inventory turns. They're talking about using AI forecasting and a lot of new technology that they didn't even have years ago to make much better decisions for franchisees to know exactly what they need, exactly how they should price it and go from there. Then you're like, well how are they going to compete with Amazon? Amazon's so convenient. It's the best price. And to be honest, they can't compete on price. That's not the game. The goal is to be able to compete on experience the in store shopping, the design franchisees are going to have the ability to choose up to 20% of their inventory and select categories that they can source locally. The local artists or the local. Like I don't even know what the categories are going to be. But like things that like the local community is going to resonate with at the local Bed Bath and Beyond store. Their goal is to have more of this like community driven feel. That's the same thing that like Ace Hardware Store does. If, if there's an Ace around you. They are all franchises. They follow very similar model to what I think Bed, Bath and Beyond wants to do, where it's like the community store, it's the local store, it's not the big Home Depot anymore. It feels more like the Ace Hardware that you would go to that is going to hopefully create this more bond with customers and that they go there. The next thing is that like Bed, Bath and Beyond, the old one had very poor online shopping experience. And I think that's a huge part of what Marcus and the team are going to put effort, which is how do we make a seamless experience where someone could go and they can buy something online and if it's not right, they can just go to the local store that's right up the street and they can exchange it and they can get a new one and then same thing, kind of both ways. This is the other big make or break is for franchisees. They have to view that online shopping experience as complimentary to their business, not competition. Part of what they talk about in their press release is that franchisees are going to share in the revenue of Bedbath and Beyond.com for sales that happen, you know, within a certain mile radius of their store. So if I own a store here in Philadelphia and someone buys something online down the street, maybe I'd never even touch the product and I get to benefit and make like a piece of that sale and I'm not going to have a problem with that because then, you know, as it comes back to life and more people are buying on Bed Bath and around my shop, then I'm going to make more money. So I think that is really key is making sure it is this tight, tight connection between the two and I believe that they can do it. And finally, the thing to remember is this is not the old Bed, Bath and Beyond. This is Overstock.com with Marco Simonis and a bunch of people at the helm leading the charge. This is the name. But everything else and all the poor decisions that were made by the previous company are different people. This is a brand new ball game. Here's what to watch out for next. First, they're still in the early stages. They just released this news less than a week ago and they don't Expect to have the franchise docs even ready until March of 2026. And Marks told me that they're not going to franchise a broken model. Like, they are going to get this thing down first and they're going to have plenty of time to figure it out. They're in rush here and the first step is converting all their Kirkland stores that they own as part of the overstock.com like legacy into bed, Bath and Beyond locations. So they're going to rebrand them, turn them into corporate stores, and then they're most likely going to sell the proven stores to franchisees. So their first stores are going to be existing, profitable stores that are going to go, not brand new ones from scratch. Because that begs the question of, like, it's hard to franchise a broken model. Well, they're not. They're going to figure it out. It says here on Twitter that they're going to have 100 stores converted by the time they're even ready to start thinking. And then they're going to know footprint, location, amount of inventory. They're going to be able to test all these things. They have hundreds of corporate stores. I believe they're going about this the right way because they know that to be successful in the long term in franchising, your franchisees have to be profitable. They have to make money. They have to want to take all their money they're making and buy more stores. I mean, that's how I grew my franchise portfolio to 50 million in revenue, is because I got it down to two locations and then I reinvested money to buy a third, a fourth, a fifth, and I kept buying more stores and opening more stores because it's a proven model. It's the best investment I could possibly make is in my own business. Marcus knows that. He's a smart guy. Their team is. Franchisees are going to invest back into the business and they're going to do things the right way. So here's my take as someone who's built been franchising for 15 years. First, I think the idea is brilliant in the sense that we're taking a concept that has a strong brand that has a lot of, like, systems behind it. And we are kind of democratizing business. That's what franchising is. It's allowing the people to run it. So now this great brand, instead of being owned by a single person or controlled by a small group of people on Wall street, is now in the hands of individuals throughout the communities. You could own a Bed, Bath and Beyond and you can make enough money in one that you open up a second and a third and a fourth and before long you know you could be making life changing money owning franchises. That is the power of it. It's still verdict south to see like how they compete with Amazon, how are they going to figure out inventory, online stuff. But if they can prove this out, especially in these corporate models, like they have this amazing test bed, then like this thing is going to go and sell like wildfire. People are going to want to get on board and they're going to take a brand that was once great, that was once, you know, one of the most recognizable brands in the space and they're going to bring it back to life. If I'm looking at the FDD in a couple of months, I want to know like revenue, what are the startup costs, what are the margins, how long until I break even? What do I do with inventory that doesn't sell? Like, there's a lot of like technical issues when someone's actually looking into it. And honestly, when the FTD comes out, I'll make a whole nother video about it and maybe I can even do a video with Marcus where we could go and show it all. That'd be really cool. I'm excited to watch this and if you want to learn more, just click that follow button as I break down new opportunities in franchising every week and share what's working. I'll see you in the next one. Cheers.