Toys R Us lays out post-bankruptcy strategy

Gladys Abbott
September 21, 2017

But nostalgic consumers who will forever be Toys R Us kids are focusing on the doom and gloom behind the announcement.

Toys "R" Us stayed tight-lipped on its reasons for scrapping this week's meetings, according to insiders - leading still more manufacturers to conclude that the retailer was in such dire straits that it might not be able to pay for its holiday inventory.

Ten days later, almost all the company's vendors refused to ship products without cash in advance, forcing Toys "R" Us to scramble to raise $1 billion for its suppliers, according to court filings.

Here's what it means to be the largest specialty toy and baby goods retailer in the USA in 2017: 866 stores nationwide, Chapter 11 bankruptcy, and getting dominated online by Amazon.

Its Canadian subsidiary also sought creditor protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice Tuesday. "Toys " R " Us will continue to offer the hottest toys this holiday season, along with an outstanding shopping experience in both brands".

Toys "R" Us (Asia) has 11 stores in Singapore, with 350 staff.

They're not alone. Many brick and mortar stores have struggled, or simply given up, and industry analysts see a trend. The Chapter 11 filing is one of the largest by a specialty retailer. Restructuring that debt would give Toys "R" Us the financial flexibility to invest and strengthen its competitive position in an increasingly challenging and rapidly changing retail marketplace worldwide. A source said that the retailer's debtor-in-possession loan may equate to an estimated amount of $3 billion. "We continue to offer fantastic new seasonal products and great customer service, just as we always have".

More news: WWI German submarine wreck found off Belgium

Did you know that it has just filed for bankruptcy protection? The company reported that same-store sales fell by more than 4% last quarter, losing $164 million.

The company's Toys "R" Us and Babies "R" Us stores and e-commerce sites around the world are open for business, it said.

During the times before the Internet (some might call this the Dark Ages), kids had to find out what games and consoles to get from friends or from the kiosks that Toys R Us had.

Many of Toys "R" Us' current woes can be traced to the $6.6 billion sale of the company in 2005 to a group of investors including private equity giants KKR and Bain Capital and Vornado Realty Trust, according to Davidowitz, adding that other retail chains have experienced the same problem.

Toys R Us was "seeing significant weakness in demand for their products globally", Brandon said in June.

Holders of Mattel stock may find some solace in the fact that at least some Toys R Us stores may remain open.

GlobalData Retail estimates that in 2016 about 13.7% of all toy sales were made online, up from 6.5% five years ago.

Other reports by LeisureTravelAid

Discuss This Article

FOLLOW OUR NEWSPAPER