Toys 'R' Us to file bankruptcy

[LM117]

Not surprised one bit.

https://www.bloomberg.com/news/articles/2017-09-18/toys-r-us-is-said-to-plan-bankruptcy-filing-as-soon-as-today

I went to the one here in Danville for Christmas shopping and it had less customers than Kmart (which I didn't think was possible). You could do donuts in the parking lot during broad daylight without hitting any parked cars....and this was in December!

[Jardine]

Had a similar experience at Circuit City 2 days before xmas during their final days and the store was near empty.  And this was back when EVERYONE was updating to HD.  How the hell you go out of business selling TVs when everyone has to replace all their sets ??

LOL, I'm on my 4th HD set on the living room.  Kept updating the main one and taking the old living room HDTVs and replaced other SD sets around the house.  Most expensive HD TV I ever bought has an old Atari hooked up to it now.



In my whole life I don't think I ever set foot in a Toys R Us more than twice.

[SectorZ]

When I was a kid we had the much better Child World in New England, and that went bankrupt in the 90's. I think, down the road, the only toy stores that will survive are small mom and pop specialty places, with the bigger retailers left in the dust due to the internet.

[jp the roadgeek]

Back in the 80's and into the 90's, it seems every mall had a KB Toys.  Then they made the mistake of expanding to strip mall locations, which, along with Walmart's expansion, essentially killed the company. Now, the remnants of what was KB might soon be defunct, as Toys R Us bought up the remnants.

[Max Rockatansky]

Surprising it didn't happen years ago.  I've haven't one of with a full parking lot even on a Black Friday in about 20 years.  I used to love to go to that place to get video games when you had to take the little cards up front to buy before you went to the booth at the front of the building.

[cjk374]

The Toys-R-Us in Monroe, LA always seems to have a nice crowd everytime I have been there.

[LM117]

Back in the 80's and into the 90's, it seems every mall had a KB Toys.  Then they made the mistake of expanding to strip mall locations, which, along with Walmart's expansion, essentially killed the company. Now, the remnants of what was KB might soon be defunct, as Toys R Us bought up the remnants.

The Wilson Mall (known as Parkwood Mall until 2005) in Wilson, NC had a KB Toys and I was practically glued to the place in the 90's/early 2000's when I was growing up in the area. Good times. Now the company and the mall are both dead.

[LM117]

Surprising it didn't happen years ago.  I've haven't one of with a full parking lot even on a Black Friday in about 20 years.  I used to love to go to that place to get video games when you had to take the little cards up front to buy before you went to the booth at the front of the building.

Yeah, I hate seeing it happen. I have a lot of good memories of Toys R Us as a kid. Damn near every brick and mortar that doesn't have a Walmart or Dollar General sign slapped on it is in deep shit it seems.

[jeffandnicole]

Surprising it didn't happen years ago.  I've haven't one of with a full parking lot even on a Black Friday in about 20 years.  I used to love to go to that place to get video games when you had to take the little cards up front to buy before you went to the booth at the front of the building.

Yeah, I hate seeing it happen. I have a lot of good memories of Toys R Us as a kid. Damn near every brick and mortar that doesn't have a Walmart or Dollar General sign slapped on it is in deep shit it seems.

While everyone shits on Walmart, they have learned how to adapt in today's retail age.  Companies like Toys R Us haven't.

Now, filing for bankruptcy isn't the worst thing to happen to them - they can reorganize, shut some stores, and get back into the game if they know what they're doing.  The biggest problem is these companies hate to get rid of the people in charge which caused them to be in the position their in the first place.

[LM117]

Surprising it didn't happen years ago.  I've haven't one of with a full parking lot even on a Black Friday in about 20 years.  I used to love to go to that place to get video games when you had to take the little cards up front to buy before you went to the booth at the front of the building.

Yeah, I hate seeing it happen. I have a lot of good memories of Toys R Us as a kid. Damn near every brick and mortar that doesn't have a Walmart or Dollar General sign slapped on it is in deep shit it seems.

While everyone shits on Walmart, they have learned how to adapt in today's retail age.  Companies like Toys R Us haven't.

Now, filing for bankruptcy isn't the worst thing to happen to them - they can reorganize, shut some stores, and get back into the game if they know what they're doing.  The biggest problem is these companies hate to get rid of the people in charge which caused them to be in the position their in the first place.

Good point.

[roadman]

Not surprised one bit.

https://www.bloomberg.com/news/articles/2017-09-18/toys-r-us-is-said-to-plan-bankruptcy-filing-as-soon-as-today

I went to the one here in Danville for Christmas shopping and it had less customers than Kmart (which I didn't think was possible). You could do donuts in the parking lot during broad daylight without hitting any parked cars....and this was in December!

I'm amazed the "home of the goofy giraffe" has lasted as long as they have.  Last time I went into one was about ten years ago.  Even then, the store was almost completely empty.  And it was clear that they had almost completely shifted to the lower quality "kid will break it within three days" merchandise.

[roadman]

Back in the 80's and into the 90's, it seems every mall had a KB Toys.  Then they made the mistake of expanding to strip mall locations, which, along with Walmart's expansion, essentially killed the company. Now, the remnants of what was KB might soon be defunct, as Toys R Us bought up the remnants.

I used to frequent several KBs in the 1970s.  What always struck me was how every item was tagged with a price, and then that price was always marked over with a lower price in red sharpie.  Of course, that was better than the toys and hobbies section of the local Bradlees, where every item was marked in black magic marker with what appeared to be an internal inventory number.

[LM117]

They filed for Chapter 11 and the stores will remain open (for now anyway).

https://www.forbes.com/sites/laurengensler/2017/09/19/toys-r-us-bankruptcy/#6adfbd48574a

Toys 'R' Us, the children's toy store struggling from a massive amount of debt and fierce online competition, has filed for bankruptcy.

The retailer sought Chapter 11 bankruptcy protection late Monday evening in federal court, seeking a way out of the $5 billion in debt it has racked up. It said it would keep its 1,600 Toys 'R' Us and Babies 'R' Us stores open as normal heading into the busy holiday season.

Toys 'R' Us has been crippled by debt since it was acquired by private equity firms KKR and Bain Capital, plus real estate company Vornado Realty Trust, in a $6.6 billion leveraged buyout in 2005. It had started the process of going public in 2010, but ultimately pulled the filing, citing "unfavorable market conditions."

The company described the bankruptcy as a way to work with its creditors to get back on solid financial footing and invest in long-term growth in a difficult retail environment.

"Today marks the dawn of a new era at Toys"R"Us where we expect that the financial constraints that have held us back will be addressed in a lasting and effective way," said CEO Dave Brandon in a statement.

The company has received more than $3 billion in debtor-in-possession financing from J.P.Morgan Chase and other lenders, which will help it sustain operations during the bankruptcy process.

Toys 'R' Us, which began as a single store for baby carriages and cribs in Washington, D.C. in 1948, quickly became a favorite destination for children's toys. In recent years, the big-box retailer snatched up competitors like FAO Schwarz and KB Toys, pursued international expansion and slashed prices in an effort to continue attracting shoppers to its colorful aisles.

However, sales have slipped in the face of competition from giants like Amazon and Wal-Mart. In its latest quarter, same-store sales fell by 4.1%, helping the retailer to post losses of $164 million.

While Toys 'R' Us said the "vast majority" of its stores are profitable, it will likely be reevaluating at its physical footprint during the bankruptcy process.

Toys 'R' Us joins a parade of other retailers that have sought bankruptcy protection this year, including shoe store Payless and children's clothing retailer Gymboree. Many other retailers have aggressively closed stores and laid off employees, instead shifting resources to online capabilities.

[Truvelo]

Those over here are still trading normally and are unaffected by events in the US. I haven't been into a Toys 'Я' Us for decades. As a kid I did notice their prices were higher than competitors. This was a consideration in the days when limited amounts of pocket money were all I had.

[roadman]

When I was a kid we had the much better Child World in New England, and that went bankrupt in the 90's. I think, down the road, the only toy stores that will survive are small mom and pop specialty places, with the bigger retailers left in the dust due to the internet.

I remember Child World.  Although they survived until the 1990s, they started going downhill in the late 1970s and had far fewer stores than either Toys R Us or KB.

[english si]

The only thing I ever bought from them is 2 lightsabres when Episode III came out. I have no idea why I went there rather than to another shop, given it was down the hill in Soton, when there were two other toystores less out of my way*. I've always had nearer, albeit smaller, toy stores to buy toys from in malls / shopping streets that I'd visit anyway rather than an out-of-town retail park site that I'd rarely visit.

*It might have been on the way to / from the cinema, which would have not been as out of the way as the cinema was down the hill anyway and we'd cross through the retail park between bus and cinema. Certainly my housemates were there, so probably was on such a cinema trip.

[sparker]

There's an associated retail outlet, "Babies 'R' Us" just down the street from my business; I went in there about six months ago to pick up something for my GF's goddaughter's kid -- and was surprised to see only 3-4 customers in the store on a Friday evening (usually one of the busier times of the week for retail) -- and there's certainly an intrinsically higher demand for baby items than toys for older children.  If such an enterprise can't draw customers, then the "parent" store, featuring a selection of items better classified as "nonessential", has little chance of success or even survival.  In this day & age, I'm just shocked this bankruptcy didn't happen a decade ago!

[Roadgeekteen]

I loved this store 7- 8 years ago.

[Scott5114]

NPR had a story on this on Tuesday, which made it sound like the company would be doing okay if not for the stupid amounts of debt they had accumulated starting in the late 1990s. (The analyst they were interviewing pointed to their Times Square location, which operated at a loss, as one of several causes of the debt.) Now, they're making enough money to stay alive, just not enough to pay off their debt.

The story also noted that one thing working against them is that toy buying has shifted online much more than some other market segments, because it is much simpler to keep a toy gift secret from a kid if it arrives in the mail in an unmarked box than if the kid sees you go into Toys R Us.

[kkt]

The one near me closed about 5 years ago.  I was surprised, it seemed crowded whenever I went in.

[Max Rockatansky]

Thought this was topical:

[formulanone]

There's an associated retail outlet, "Babies 'R' Us" just down the street from my business; I went in there about six months ago to pick up something for my GF's goddaughter's kid -- and was surprised to see only 3-4 customers in the store on a Friday evening (usually one of the busier times of the week for retail) -- and there's certainly an intrinsically higher demand for baby items than toys for older children.

They're usually busier places on weekends, but I haven't had to go to one in 5 years.

On the other hand, Target and Walmart have bigger selections over the past decade, and it's a sector where the second-hand market seems to do alright (it also competes against a market where people willingly donate unused durable baby stuff). There's still some immediacy for baby/toddler items that online stores can't always compete with.

[adventurernumber1]

Thought this was topical:

Yes!! As a subscriber to the rising channel Company Man (the creator of that youtube video), I was planning to watch that very video that was just uploaded, but I haven't gotten the chance as of yet.

For those interested, this same person also has a very good video on the decline of Kmart (this channel is brand new, growing quickly, and has very interesting videos on companies and the sort, including the declines of some companies):

https://www.youtube.com/watch?v=1__Qg1toSSs&t=

For my two cents, I honestly did not see the bankruptcy of Toys 'Я' Us coming. I haven't been to one in roughly half a decade, so I really don't know what the stores even look like these days. I guess it's not too good, though, obviously. 

Whenever I would shop there with my parents as a kid I always seemed to like the place. The same goes for Kmart. As a matter of fact, my parents like shopping at either Kmart in my town, precisely because there's never hardly anyone there. As a 5 year old, I would've never imagined that either retailer would fall to such bad fate.

[bing101]

https://locations.dollartree.com/ca/colma/

I remember Colma, CA had a Toys R US but that got replaced by a Dollar Tree in the area a few years ago. Also the Vallejo, CA location of Toys R US got taken over by Best Buy. Best Buy demolished the old Toys R US in Vallejo and put a Best Buy just 6 years ago.  I'm saying that Toys R US has been in decline for some time though.

[Truvelo]

http://www.bbc.co.uk/news/business-42204182

Toys R Us is preparing to shut a quarter of its stores over here.