Last September Toys R Us filed for Chapter 11 bankruptcy. It was hoping to relieve some of its multi-billion dollar debt and continue to operate.
Things didn’t pan out as expected. The Christmas holiday sales were not up to par. Then the situation became worse and Toys R Us announced earlier this year it’s going to fully close down.
This means about 31 000 employees will lose their jobs by the end of the month. Fans of Toys R Us have less than a week to go the stores and check out the final deals and promotions. Expect some big discounts as Toys R Us tries to clear as much stock as possible.
Toys R us will definitely be missed by the toy industry. Consumers won’t feel that much of a change as they are the reason for the closure. Most of them are shopping for toys online already. That’s one of the main reasons why Toys R Us didn’t do much sales and went up in debt.
Why go to the store, when you can get the same toy online, sometimes even at a better deal? That, along with Toys R Us’ inability to adapt to the new times and create better customer experiences were deciding factors.
But for smaller toy brands Toys R Us was important. The stores put a lot of these toys in better positions and showcased them more. This allowed for customers to discover them while going around the store, looking for the more popular toys. Now these smaller brands will have to rely on other retailers to do the same. And they will also have to improve their online presence if they want to stay relevant in the new situation.
As for Toys R Us, it’s sad to see them go, but it is what it is. Since KB Toys is coming back, nothing is impossible. Maybe some day Toys R Us will also return. Until then, goodbye, Toys R Us.