A private company, Toys "R" Us was bought by private equity firms Kohlberg Kravis Roberts and Bain Capital and real estate firm Vornado Realty for around $6 billion in 2005. About 40 per cent of the company's total annual sales happen during the fourth quarter, highlighting how much it depends on that holiday toy rush.
Toys "R" Us said it expects to continue honoring return policies, warranties and gift cards, and customer loyalty programs should stay the same. The company is now struggling with about $5 billion in debt, and hopes the bankruptcy filing can help them restructure while still keeping their stores open for the holiday season.
When asked about possible layoffs, Toys "R" Us responded to a Global News email saying the bankruptcy protection isn't about "store closures or staff reductions", but rather a "proactive step" to improve the business.
Toys "R" Us Canada filed for creditor protection in an Ontario court on Tuesday, adding that its 82 Canadian stores will continue to operate as usual during the process. "Other retailers have closed thousands of stores and laid off tens of thousand of workers as they try to cut costs and compete with e-commerce", writes Michael Corkery for the New York Times.
Along with its subsidiaries, Toys "R" Us (Asia) runs more than 220 outlets in East and South-east Asia, with another 35 licensed outlets in the Philippines and Macau. In 1957, he opened the first Toys "R" Us store.More news: Hurricane Maria makes landfall on Puerto Rico as a Category 4 storm
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"Until Toys "R" Us comes up with perhaps a better business mode, where they can recapture some of the interests of their demographics, they will have a problem long term", said Mitra. It was facing $440 million of debt maturities in 2018 followed by $2.6 billion in 2019.
Toys, and Toys R Us in general, play a huge role molding our sense of self.
Uninspiring offerings from key suppliers such as Lego AS recently haven't made it easier for Toys "R" Us to boost sales.
Toys "R" Us and had no other choice but to file for #Bankruptcy protection on September 18, 2017, to restructure its debts and save the company.
The chain retailer announced in March it was filing for bankruptcy and closing about 200 of its stores and evaluating what to do with the remaining 1,300. Marc Rosenberg, a toy marketing executive, said Toys R Us hasn't been aggressive about building its online business, and let those sales migrate to rivals.
Lee explained that while a decade ago children were playing with traditional toys, the store needs to adapt to the "new kids on the block" that would rather buy electronics.