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News Good-bye Toys R Us?. Store may close down starting next week

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Even if you are not a fan of My Little Pony, this is bad news all around in the Toy Industry.  Toy giant Toys R Us may be expecting to liquidate its assets starting next week, 

Quote

Toys R Us could soon liquidate its U.S. operations and the result will leave a lasting impact on the toy industry, Jefferies analyst Stephanie Wissink wrote in a note to investors Friday.

While Toys R Us accounted for 15 to 20 percent of U.S. toy sales last year, not all of that will shift to other retailers when the retailer is gone. Instead, about 10 to 15 percent of this volume will fall through the cracks and be lost for good.

Wissink estimates between 85 and 90 percent of Toys R Us' volume in the second half of the year would be redistributed. Products will shift and be sold by e-commerce sites such as Amazon, big-box stores such as Target or Walmart and drug and grocery stores. Other retailers such as Kohl's, J.C. Penney and Best Buy may clear more shelf space for toys.

"It's difficult to estimate, but based on third party consultancy surveys of consumer visits to TRU, roughly 10 to 15 percent of purchases are estimated to be incidental and may not transfer to other channels," Wissink wrote.

Sources told CNBC on Thursday that Toys R Us could soon liquidate its U.S. operations, but that situation remains fluid. A terrible holiday season hurt the toy retailer's chances of recovery, and it has already begun liquidation sales ahead of planned store closures.

Toy companies such as Hasbro and Mattel have already begun preparing contingency plans for such an event. Representatives from Hasbro told CNBC during the New York Toy Fair in February that they are not dependent on one retailer and have explored multiple new channels to sell the company's toys.

While Amazon, Walmart and Target will pick up the slack for bigger toy companies, small toy brands could be in trouble.

Toys R Us' massive size allowed it to sell both name-brand toys and products from upstart toymakers. However, with its closure, the big-box retailers likely won't take in these brands because they are already pinched for shelf space in the toy section. This will make it even harder for small toy manufacturers to gain ground.

Wissink said she expects the fallout of Toys R Us' liquidation to cause a rise in the number of mergers and acquisitions of smaller toy makers. Hasbro and SpinMaster are likely the best-positioned toy companies to make these acquisitions and build out their portfolios, she said.

 

Source: https://www.cnbc.com/2018/03/09/10-percent-15-percent-of-all-toy-sales-could-be-lost-forever-if-toys-r-us-liquidates.html

Even with their recent failures, it's going to be really sad if Toys R Us does go out of business.  It will be bad for toy makers like Hasbro, Mattel and LEGO, not to mention lesser toy makers like NECA, Mezco and Jakks Pacific will be affected even further since they rely on Toys R Us for their sales.  Even worse, other merchant stores like Target and Walmart are also affected by sluggish sales due to the rise of Amazon and the likes.

The end of an era if this is true.  And I still go to their store from time to time.

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It's a damn shame that this is happening, but whether we like it or not, digital distribution is the future. Even then, toys in general aren't what they used to be. Most children that I've seen are interested in mobile games and the like. Will toys as a whole die? No, but I have a hunch there will be a demographic shift in the toy industry at some point. While children may be playing with toys less and less, collectors will almost always exist, and if you ask me, it's very possible they will become the backbone of the industry.

That's how I feel about this, anyways. It's a shame to see Toys 'R Us effectively on its deathbed, but that's just the way the cookie crumbles sometimes.

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I haven't been in a Toys "R" Us for years and years, though I do have good memories as a little kid running through the aisles of the store with a piece of paper and a pen, marking down what we wanted for Christmas. It's sad to the chain go like it was to see Block Buster and so many others close, but maybe because they're having liquidation sales I can go and get some pony merch for marked down prices :ooh: 

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(edited)

All of them?

I heard only some.

My ToysRUs wasn't one of them, and it's been there literally since I was in elementary school.

I played and loved the Mario 64 demo there. All the game isles. I even got my Switch on opening day there. Ticket number 2! There was a guy even before me, and I got there two hours ahead.

Damnit Amazon. I always prefered to go to the physical stores anyway. There you can actually see things and get them immediately rather than having to wait days in mail. And what if you didn't like it? I mean, send it back, sure, but what the f is wrong with normal stores? I mean sure, I'm not buying from there all the time, but I do like to jump in every week or so to see what Pokemon or Pony things there are, and sometimes I buy things.

Edited by Toastypk

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This is what happens when progress is made. Online shopping has become the standard with the old way of doing things--shopping at a store--is slowly being phased out. It also doesn't help the toy industry that kids these days are into the latest technological trends.

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Unfortunately, I saw this coming for some time now:  While Toys R Us always had great selection, they would mark up the prices on all their stuff like 15% or so, then every so often have "sales" that gave you 15% off, so you'd be paying what you'd pay at other retailers.  I was wondering when that kind of shady business practice would bite them in the ass, and it looks like it finally happened.

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5 hours ago, DJ_Bonebraker said:

Unfortunately, I saw this coming for some time now:  While Toys R Us always had great selection, they would mark up the prices on all their stuff like 15% or so, then every so often have "sales" that gave you 15% off, so you'd be paying what you'd pay at other retailers.  I was wondering when that kind of shady business practice would bite them in the ass, and it looks like it finally happened.

Two words: Bain Capital

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Buzzed a friend about this who normally makes stuff from the nerf guns they sell,

really shocked to hear such a big company just going under like that.

They're telling me over the course of the next two weeks (give or take) that they're closing all stores nation-wide

O_o

 

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It's a huge shame that Toys 'R' Us is closing its stores...It really was a great store to go to...If only there is a way to keep the toy company up and running...

But, I say there is still hope that toy companies can recover from this. By looking at the bottom section of the quote, it says the "Toys 'R' Us liquidation will cause a rise in mergers and acquisitions of smaller toy makers". To me, it is like a sunflower reproducing seeds so they too can grow into beautiful plants. So, while we may see a big change in marketing, the toy industry would still be okay.

But still, we'll never forget Toy 'R' Us for all the joy it brought to all our souls.

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I remember when they closed the ones by me, so I never went to one. The only time I've been to one was in New York in Times Square, one month before it shut down. They had a darn ferris wheel inside! It was awesome! It's a shame it's gone now.

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Same with in UK, first I went to was in London, twice in my hometown, my brother there nothing much as we got another large toy store, Toy Smyth. I bought few things there but shame they be closing down. Why do popluar store like Toy R Us and Borders close down.  But believe not all Toy R Us not closing down

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Toys R' Us has had multiple chances to get more into the video game and digital media market but dragged their feet and only went half-in most of the time. Now they are paying the price for trying to resist the future we all knew was coming.

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No way, I refuse to believe that. Toys R Us is one of the best stores that no one can outgrow.

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I was concerned about this including the collectors as well, but the biggest question is what date is when they're gonna be closed at. I know it's gonna close next week, but I just wanted to be sure what date when they're gonna be closing.

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Never had any close by growing up, or the money to shop at one, but I really did enjoy the few times I was able to visit. Extremely unfortunate, but honestly digital sales can't be fought, it's the way of the future. And really, give the current generation a tablet or phone or vidya and that will substitute for pretty much any toy that could be bought regardless. Just the changing of time, tech, and interest really.

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(edited)

R.I.P Toys R Us. I used to get my Transformers Armada figures all of the time there. So many good memories of Christmas shopping there with the family.

Edited by ultrairongorilla

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(edited)

I had kinda predicted but didn't want to believe it at the time. But it's happening. If Canada can keep up, then Toys R Us Canada could be bought and become a spinoff. But the death of Toys R Us U.S. is inevitable.

Besides, toys are dying themselves. Every 6-10 year old is on a Nintendo Switch or finding that rare Pokemon on their phone. Toddlers learn how to use an iPad before they can even manage two days without messing their Pull-Ups :lol:

And look at us right here, us adults and teens using the Internet and playing video games all day instead of playing chess and inviting real-life friends over.

 

Edited by Shabb3r

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On 3/10/2018 at 11:34 AM, SaburoDaimando said:

Two words: Bain Capital

Exactly. If it wasn’t for their meddling, TRU might have the ability to emerge from bankruptcy as a leaner company ready to adapt to a changing marketplace. That’s not to say that Amazon, Walmart, and Target wouldn’t have put them out of business eventually anyway. But the mountains of debt piled on by Bain has certainly hastened their demise. TRU is not alone. Several chains that have gone bankrupt or out of business have been hurt by equity firms. 

 

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It's a shame. I always loved walking into a Toys-R-Us. Heck, at 21 I still love walking in one! Kinds brings me back. I have good memories getting Sonic the Hedgehog toys and Pokemon games there. Oh, and Godzilla toys! For some reason, I had a tough time finding them as a kid! 

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At lot of stores died where i'm from. Kmart was the last one to go. The problem is that there's too much competition and, price wars. Pretty much when my Kmart got rid of their video game section of the store, it pretty much died afterwards. Not to mention the prices were higher than any other store ive been too.It doesnt surprise me in the least that toys r us is going out of style now.

Refusing to compete in sale prices has consequences. Also the new gen of kids are into technology too much.  They want the latest smartphone instead of a doll or a hot wheels car.

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It's really sad. The overall industry will face a blow, but a big source of nostalgia may be gone. I remember one of my favorite times when I was a kid was going to my local TRU, and I've been going occasionally to hunt for pony toys. Not only that, but the stores keep a childish wonder that makes me go over and over. Sad that my closest one opened not a year ago :(. I'll never forget waking up early just to get Samus Returns and my squishy amiibo on their release day in one of those either 

6 minutes ago, Mystic Brush said:

At lot of stores died where i'm from. Kmart was the last one to go. The problem is that there's too much competition and, price wars. Pretty much when my Kmart got rid of their video game section of the store, it pretty much died afterwards. Not to mention the prices were higher than any other store ive been too.It doesnt surprise me in the least that toys r us is going out of style now.

Refusing to compete in sale prices has consequences. Also the new gen of kids are into technology too much.  They want the latest smartphone instead of a doll or a hot wheels car.

True, it's far more economic to have a device which can download many free to play games to keep kids busy

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(edited)

Reminds me of when Zellers was going under, those last few years before Target changed over all the stores were the best and worst for finding cool things toy and video game related. I ended up with some weird VR hand remote controller thing that came with a dozen games for ten bucks (edit: was a P5 Glove). Toys R Us vanishing will suck so much, I still loved going in there just to wander around.

Ironically Target Canada bit the dust not even 2 years after coming up here, so they cost us another of our few big box stores thanks to their failed expansion plan. Aside from Walmart we have nothing now, unless you count Superstore and Canadian Tire trying to Walmartify themselves. Giant Tiger's just too tiny.

Edited by Appleachia

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Yeah, I've been predicting this for a while now even since my home city closed down the vast majority of Toys R' Us. There's one in my neighborhood but it's virtually empty and on the verge of closing down as well. I have memories of going to Toys R' Us when I was much younger, but honestly, it's mostly their fault for failing to adapt to new demands. It's not only because they don't delve enough into the digital market, but they also fail to give out a good response to online competitors as well. Anything you can buy on Toys R' Us, you can always just buy on Amazon, sometimes for a lower price. And in some places, sometimes it's just easier to purchase stuff online rather than possibly drive 30 minutes to your nearest store. 

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