TRUbecontinued?
Only time will tell, but Toys R Us did leave store fans wondering with a couple of vague social media posts last week when it shuttered the last of its stores across the country. In one Facebook post, there’s a picture of Toys R Us mascot Geoffrey the giraffe holding a rolling suitcase and donning attire that would make you think he’s going on vacation. The caption confirmed as much, when it mentioned that he was just going on a little vacation and he would eventually be back.
Toys R Us’ closing was a long time in the making after years of mounting debt and no business model that worked to right the sinking ship. Things finally came to a head back in September 2017 when management announced it would be liquidating in March 2018. This comes after a bankruptcy filing that saw it claim nearly $5 billion worth of debt.
The so-called “Toys R Us kids” of both yesterday and today aren’t the only ones sad to see the big box toy retailer go. It’s estimated that as many as 30,000 store workers are now out of a job, and with no severance package to boot. Of course, there’s the toy distributors who are affected as well, as this was one big box store they could count on for large orders of all the latest and greatest toys and gadgets to hit the market.
Is There Hope for a Toys R Us Revival?
Certainly, the vague social media posts will lead you to believe that the Toys R Us brand will continue to exist in some way, shape or form. And former Toys R Us CEO Gerald Storch is reportedly trying to come up with a business plan that will bring the brand back to life and restore jobs to the now-unemployed former associates. But experts are saying that the chances of the latter coming to fruition are slim to none due to the massive amount of money it would take to purchase the brick-and-mortar stores, solidify the supply chain and support the infrastructure that’s necessary to do business in today’s world.
Not only would all these factors have to be met, but there’s also the fact that any new business is almost always not profitable to begin with. And do you think the toy companies are going to want to ship product to a store that’s chances of survival are iffy at best? Probably not.
What’s more is that other stores have attempted to do what Storch is vying for and have failed. The Sports Authority is one prime example.
If anything, Toys R Us is likely to live on through its name only. As part of the liquidation, Toys R Us is selling its trademarks and IP, so someone would be able to purchase the rights to these properties and resurrect it how they see fit. Perhaps another retailer will purchase it and dedicate a Toys R Us wing in one of its already existing department stores? Or maybe online giant Amazon will breathe life back into Toys R Us, but as an online-only entity?
Whatever the case, Toys R Us likely isn’t gone for long, but when it returns it’s going to look drastically different.
Where Can I Shop for Toys?
Until some version of Toys R Us is resurrected, there are a plethora of places to shop for toys, and certainly your family-owned local toy store is a good start. Considering that many small, locally-owned toy shops were likely put out of business when Toys R Us rose to dominance, taking your business to the ones that still exist would be a nice gesture. The aforementioned Amazon.com is a good source for everything if you’re OK not closely observing the product before purchase, and the likes of Walmart, Meijer, Kohls and Target are big box department stores with dedicated toy sections too.
The holiday season will be here before you know it, so it’s time to start planning where you’ll be doing your toy shopping for the little ones on your list this year, at least until the Toys R Us brand can “TRUbecontinued.”
Regards,
Ethan Warrick
Editor
Wealth Authority
