We reported yesterday that the closure of all Toys R Us stores in the US was “likely”, and unfortunately, we can now confirm that it is a certainty. A few hours ago, Toys R Us attorney Joshua Sussberg went before bankruptcy judge Keith Phillips to present plans for the liquidation of all of Toys R Us’ remaining US stores, as well as the corporate headquarters.
It is reported that a part of the plan going before the courts also concerns the Canadian branch of Toys R Us, which is planned to be sold as a part of a package that also involves up to 200 of the best performing US stores. The Central European and Asian Toys R Us chains are also reportedly going to be sold off.
Attorney for the creditors committee, Kenneth Eckstein, said of the decline of Toys R Us in recent months: “This is the largest and most rapid deterioration of a retail company that I have ever observed. Nobody will come out of this happy or paid in full”. Mr Eckstein predicts that vendors will lose hundreds of millions of dollars from shipments that have not been paid for.
Read the report of the bankruptcy proceedings on NorthJersey.com.
More information on the implications of the end of Toys R Us are set out on the Wall Street Journal (paywall). The headlines of that article are that many toy makers are left without a place to showcase their wares the year round, or test the market with more experimental products. Stores like Walmart and Target, who are expected to fill the void short-term, tend to play it safe, and bank on proven sellers and established brands. WSJ suggests that this could lead to a slump in the toy market, with BMO Capital Markets analyst Gerrick Johnson quoted as saying this could lead to fewer breakout items, as Toys R Us was a testing ground for a lot of things. It is reported that Hasbro may lose around 3% of its sales from the closure of Toys R Us – but smaller manufacturers are looking at a hit of up to 30%, a third of their sales.
Closer to home, what the closure of Toys R Us might also mean is a narrowing of what big branded toys, the kinds Walmart and Target stock, offer. Toys R Us was willing to take on certain product lines that those stores would not, particularly big items that occupied a lot of shelf space or higher priced collector oriented lines. Products such as those may now see a considerably more limited release, and there will probably be fewer of them, for the same reasons there might be fewer breakout items.
In it all, we should also remember there are 33,000 people who are losing their jobs out of this. Our thoughts and sympathies are with them, as they are the victims of a series of unfortunate events that has led up to this sad day.
Venixion
TrU is closing: Oh no! The last dedicated toy store is dying. Share pictures, memories and your last purchases, boo hoo!
Announces its return: How dare those bastards do such a thing? Dead is better! Dead. Is. Better!
This thread in a nutshell.
stad
It'll be quite a while, if ever, before it gets to that level.
Lazerwave
With toysrus coming back under a new name, I guess it's back to business mapping out the stores on vacation.
artimus prime
I couldn't agree more. I use true heroes vehicles with my transformers…. especially the live action transformers. Their prices have skyrocketed.
Tekkaman Blade
Don't remember it was quite that much but after the sale it shot up to 5 or 6 billion in Dept.
But your right I was confusing it to when the original owner/manager stepped down in the mid 90's. The company was in much better shape then, but 5 or 6 years later Wal-mart was out selling them. So they tried to go bigger like opening up that Toys R us in times square. Toys r us was doing fine, what was hurting them was Kids R us and Babies R us which many were closed and I believe all Kids R us were. Those were created after the original owner left. That was how they got in dept. But no where near as much as they would after the buyout. Then they started buying out other Toy companies Etoys.com and Toys.com, and toy retailers KB Toys and FAO Schwarz. Yes that's why those went away, they wanted to be the only toy store. And the dept kept growing.
stad
TRU was over $1B in debt when it was bought in the leveraged buyout.
Afterburner
Keep in mind it was the debtors that ultimately forced this whole situation, so yes it's still basically the same owners here. The American employee is not treated on the same level as the shareholder and until that changes, you will see situations like this more often and it will get worse. If the government didn't just make it readily apparent over the last month, the people in power will get away with as much as you let them get away with. There is no line that will not be crossed. If you don't like it, you have to fight back. That's done with your wallet and at the ballot box. And it's never being afraid to speak the truth, whether people can handle it or not.
RKillian
The flat modern Geoffrey is sterile and lifeless, like it was designed by committee. It's the same when you look at how Mario was drawn back around the 2nd and 3rd games versus that awful plastic 3D version they've had since the GameCube.
View attachment 28099690 View attachment 28099691
Shepard Prime
I'm just glad that I can still get the True Heroes stuff if that's their plan. Their figures may be bland but their vehicles and playsets are aces.
WishfulThinking
That's not the plan. The plan is to do "store-within-a-store" displays with True Heroes, Imaginarium and whatever other off-brand toys they own the IP on. My suspicion is that they hope to raise easy capital this way and then use that to potentially reboot the stores in the far future. But they'll need a LOT of that easy capital to make it work. I don't know how many parents are going to rush out and buy that off-brand stuff at potentially higher prices than before – but I guess you never know.
But yes, it feels a bit like "Weekend at Bernie's" with a toy store instead of a corpse.
009*
I wouldn't be surprised if they just opened up some new stores inside shopping malls. Sears is one foot in the grave and Younkers just shut down all its stores so there's so space available.
WishfulThinking
Well, slapping a sticker on product you already own and is probably just sitting in a factory somewhere while getting a "Midwest-based retailer" to agree to let you sell you wares through a special toy section isn't rocket science.
It's considerably easier than creating an infrastructure to ship toys to as-of-right-now non-existent warehouses to as-of-right-now non-existent big-box stores in 500+ medium to super-large market across the nation.
Seriously, this is about the laziest way of making a buck as they can find to do.
TFXProtector
Look at what they've pulled off so far. If I was a betting man, I'd put money down on 'em.
WishfulThinking
"Down the road", though. Not "tomorrow". Not "this year". Probably not even "next year". Maybe "not at all".
TFXProtector
Because they've clearly stated that their plan is to reopen physical stores down the road. Right now, it's Geoffrey's Toy Box LLC, but TRU itself will return and they'll own all of it aside from Canada. It's been in multiple news reports. When it's all said and done, they're trying to revive the brand without owing a dime. Which is crappy. And when they do finally reopen, there'll be no calls to the employees who got the shaft. I don't even know if they can pick up unemployment in some cases. (Each state and county handles it differently.)
WishfulThinking
I'm still trying to figure out where anyone is getting the idea that they're "opening" anything. This isn't even a pop-up store situation. This is the current TRU IP owners realizing they still own the rights to True Hero (and other TRU KO brands) and want to shove it into a already existing mall store with a sticker of Geoffrey's noggin slapped on it.
I mean, former employees can get mad at that I guess… I just don't understand why. It would be like Kroger shutting down and then getting upset as a former employee if I saw Big K being sold at Walmart.
AzT
Yes, Larian will still support and sell to TRU Canada, just not whatever the stateside version becomes. From
his Twitter feed and also
Toymaker who tried to keep Toys R Us alive says new version of company is dead to him
Might Hasbro get any Geoffrey's Toy Box questions during their upcoming earnings conference call, or has that ship completely sailed?
Hasbro to Webcast Third Quarter 2018 Earnings Conference Call | Hasbro, Inc.
G.B. Blackrock
That was my mistake. Yes, Charles Lazarus, founder of TRU, died roughly the same time as his store did.
I was temporarily confusing his name with Larian, the owner of the company that makes Bratz, who had put in an offer to save the US stores some time back, but whose offer was rejected by the debt owners as being too low. He's said something recently about refusing to support this new venture, ostensively on the grounds that it was unfair to the former employees of TRU.
all are dead
Didn't he just die?
Shepard Prime