Bed Bath & Beyond skips California stores amid regulatory friction

The retailer abandons a California comeback, citing a regulatory climate while the governor weighs in on the state’s appeal for business.

Bed Bath & Beyond skips California stores amid regulatory friction

LOS ANGELES and Nashville — Bed Bath & Beyond said its revival will not include brick-and-mortar stores in California. Marcus Lemonis, the company’s Executive Chairman, told reporters on Aug 20 that the state will be served only by delivery as the firm rebuilds after bankruptcy and closing all stores in 2023. The company reopened its first Bed Bath & Beyond Home store near Nashville on Aug 8. In response, California Governor Gavin Newsom’s office said the state remains hopeful the brand can find a way to be relevant again while noting the company’s past closures.

Lemonis has signaled a broader expansion plan that would steer growth toward smaller outlets, including as many as 300 neighborhood stores through the Kirklands brand investment. He argued the California regulatory environment makes a traditional comeback there impractical and attacked what he called a burdensome policy framework. The episode follows a separate local dispute involving Camping World, another Lemonis-led business, over permitting a large flagpole in San Joaquin County, a case the county described as self-inflicted but that Lemonis has framed within a larger debate about business climate.

The USA TODAY report on the California decision notes the company’s bankruptcy recovery and the country-wide context in which retailers reassess their footprints. The development adds to a broader conversation about whether states can attract and sustain major retailers amid evolving regulatory expectations and shifting consumer behavior.

The move highlights a growing tension between big investors and state policy. California is advocating ambitious climate and emissions rules, while firms argue that such rules raise costs and risk, especially during a fragile rebound from bankruptcy. The bedrock question for California is not just whether it can attract stores, but whether it can balance environmental and labor standards with a welcoming business climate. The decision to focus on smaller formats elsewhere reflects a strategy to preserve scale without being tied to a single, high-regulation market.

This episode also tests the political optics of business activism. When a high-profile investor frames regulation as a primary obstacle, lawmakers face pressure to demonstrate that policy protects public interests without stifling growth. For workers and consumers, the debate centers on whether job creation and fair prices can coexist with robust public safeguards. The frame matters as much as the facts, because perception shapes investment and local sentiment.

Highlights

Policy and markets will continue to collide as retailers chart their comeback routes.