Current Events > Toys 'R' Us may go out of business next week, close all U.S. stores

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http://wgntv.com/2018/03/09/toys-r-us-may-go-out-of-business-next-week-close-all-u-s-stores-reports/

NEW YORK Bankrupt retailer Toys R Us may shut all its US stores as soon as next week, according to several reports.

Thats terrible news for the two biggest publicly traded toy companies. Investors are clearly preparing for the worst. Shares of Hasbro fell 3.5% Friday morning while Mattel plunged 7%.
Smaller toy company Jakks Pacific fell nearly 5% too. Canadas Spin Master, which owns the popular line of Hatchimals toys, was down about 3% as well on the Toronto Stock Exchange.

And everything isnt awesome for privately held European toy giant Lego either. The plastic bricks maker reported its first sales drop in thirteen years earlier this week. So these are clearly tough times for the toy makers.

A spokesperson for Toys R Us declined to comment on the liquidation chatter.

Toys R Us recently went into administration in the UK, paving the path for stores there to shut their doors. And the potential closing of Toys R Us in America would be a particularly huge blow to Hasbro and Mattel.

According to recent regulatory filings from both companies, Toys R Us accounted for nearly 10% of the companies overall sales.

Toys R Us is the last megastore dedicated to toys. Without it, toymakers will struggle to promote anything but their most popular items.

The death of a top customer is the last thing that Mattel and Hasbro need right now.

Mattels overall sales during the fourth quarter (i.e, Christmas) fell 12% from a year ago, led by big drops for the Fisher-Price, American Girl and Lego competitor Mega Bloks brands.

Hasbro reported a decline in sales during the fourth quarter, despite the fact that the Nerf and My Little Pony owner now holds nearly all of the lucrative licenses tied to movies from Disney and its many other studios Pixar, Marvel and Lucasfilm.

Hasbro said that Star Wars product sales actually fell in the fourth quarter, as did sales of Disney Frozen toys.

The softness in the toy industry is partly due to the rise of video games and other high-tech toys that kids are increasingly playing with instead of action figures, dolls and board games.

But the shifting tide in retail isnt helping either. The dominance of Amazon has put pressure on many consumer products companies as Amazon has made a relentless push to lower prices.

Recent struggles at Walmart and Target are also hurting Hasbro and Mattel.

Walmart is the largest customer for Mattel and Hasbro, accounting for about 20% of total sales for each toy maker. Both toy companies get nearly 10% of their revenue from Target too.

So whats next for Mattel and Hasbro? Investors are still hoping that Mattels new CEO Margo Georgiadis, formerly an executive at Google, will be able to turn around the company with a greater focus on interactive toys.

Time may be running out for both companies though, which is why there have been frequent rumors that Hasbro may buy Mattel.

Investors have dreamed about a possible merger between the two companies since November, following a story in the Wall Street Journal that said Hasbro was going to make a bid. Reuters later reported that Mattel turned Hasbros offer down.

Takeover chatter resurfaced in late January. A spokesperson for Mattel told CNNMoney at the time that the company had no comment on the new speculation. Hasbro did not get back to CNNMoney.
But as long as both companies continue to struggle, expect merger rumors to keep swirling.
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I mean, why buy toys when you can just let your kid play on a phone?

Seems like a money saver to me.

I suppose one bright side is kids might actually believe that Santa makes toys in his workshop.
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A friend of mine who is an HR manager for tru said that the CEO sent out emails talking about liquidating the stores with no timeframe.
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very sad news. it's strange too because I remember a time when Toys R Us and Amazon had an online partnership. Don't understand what had happened there and what made Amazon become such a toy juggernaut on their own
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EvalAngell posted...

very sad news. it's strange too because I remember a time when Toys R Us and Amazon had an online partnership. Don't understand what had happened there and what made Amazon become such a toy juggernaut on their own

Deals and not having to pay msrp, along with ability to buy from private sellers all backed with a money back guarantee. And now grandma can buy toys for the kids and have them shipped cross country to their door step ifbthey can't make it.
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Carveless posted...

why buy toys when you can just let your kid play on a phone?

as bad as it is that kids are getting addicted to iphones at young ages, if it keeps them quiet on flights and at restaurants, then go for it
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Muffinz0rz posted...

Carveless posted...

why buy toys when you can just let your kid play on a phone?

as bad as it is that kids are getting addicted to iphones at young ages, if it keeps them quiet on flights and at restaurants, then go for it

I don't plan on having kids, so I really don't have a say on it. But I do prefer kids being quiet in public areas.

RE_expert44 posted...

A friend of mine who is an HR manager for tru said that the CEO sent out emails talking about liquidating the stores with no timeframe.

As in liquidate whenever an owner feels like it or get as much inventory cleared ASAP?
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It's not that kids don't want toys. Toys R Us just sucks. The toys are overpriced as fuck compared to just shopping online and nobody wants to physically go to the store for some damn toys.
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except that you're setting an awful precedent and basically saying its OK for yours kids to become mindless zombies with no social skills.

I can't stand when my nieces are out to dinner and they HAVE to have their Kindles + headphones or else they won't sit still and behave. You can't even have a conversation with them or teach them proper manners.
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Toys R Us never adapted. same high prices. no real specials or deals. why get it at Toys R Us when you can get it at Target for cheaper and much more convenient. they also never really embraced online shopping...there was nothing special about them.
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Jagr_68 posted...

RE_expert44 posted...

A friend of mine who is an HR manager for tru said that the CEO sent out emails talking about liquidating the stores with no timeframe.

As in liquidate whenever an owner feels like it or get as much inventory cleared ASAP?

If anything theu are going to keep doing what they have been doing. Closing down the slowest stores. For the past 4 years they have shut down several stores in my area and moved all stock to the busier stores. Their main stores could stay open for a few years possibly trying to get rid of left over stock.
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TheVipaGTS posted...

why get it at Toys R Us when you can get it at Target for cheaper and much more convenient

This is what I can't quite grasp. The Targets in my area have always had a shit selection of toys compared to Toys R Us. And the toy section is always a mess. Toys R Us had a much better selection of boys, girls and "learning" toys. I can't understand how they're being put out of business by department stores with smaller selection.
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https://www.youtube.com/watch?v=-K4MbNFN7ws" data-time="

Time to cop a switch
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EvalAngell posted...

TheVipaGTS posted...

why get it at Toys R Us when you can get it at Target for cheaper and much more convenient

This is what I can't quite grasp. The Targets in my area have always had a shit selection of toys compared to Toys R Us. And the toy section is always a mess. Toys R Us had a much better selection of boys, girls and "learning" toys. I can't understand how they're being put out of business by department stores with smaller selection.

because that smaller section is still much more convenient and has a fair amount of products that kids in the Toys R Us age group like. And for the bigger things you can still get them easier on Amazon or Target's website for cheaper. Toys R Us was a store still operating like it was 1999. Sure they had a website but nothing about that was adapted for the customers. Most stores are finding ways to evolve their online marketplace while tying it in with their brick and mortar stores for convenience. Toys R Us just kind of had both exist independently and did nothing special to keep old customers while attracting new ones. I'm surprised they lasted this long.
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RE_expert44 posted...

EvalAngell posted...

very sad news. it's strange too because I remember a time when Toys R Us and Amazon had an online partnership. Don't understand what had happened there and what made Amazon become such a toy juggernaut on their own

Deals and not having to pay msrp, along with ability to buy from private sellers all backed with a money back guarantee. And now grandma can buy toys for the kids and have them shipped cross country to their door step ifbthey can't make it.

This. Plus not getting people into the stores didn't just hurt the bottom line with lost sales from major items (video games, legos etc) but the additional spontaneous purchases someone might make once they're in the store. Buying an extra pack of batteries, a pack of crayons heck even a soda or candy that TRU sales.

The loss of foot traffic in stores to online leads to lost revenue because it's the unintended purchase that allowed major retailers of the past to thrive for decades. It's the why the concept of the "sale" exists in the first place, an incentive to get people into the store knowing once they're in customers might buy more than what they came in for. All of those lost purchases can leads to millions in lost revenue. It's another reason why online shopping is killing a lot of major retailers.

Scorsese2002 posted...

Hasbro may buy Mattel

I guess this explains why the Mattel Thingmaker was cancelled. That's unfortunate because I really wanted one.
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The last time I went to Toys R' Us was when I was buying Goldeneye. Paid 59.99 when msrp was 49.99, but they were the only ones who had it.

Who knew chatging over sticker was a bad plan for the future.
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Kmart outlives another one.
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So toysrus joins bed, bath and beyond and blockbuster video
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jeffhardyb0yz posted...

I was in a toys R us like a week and a half ago and felt all magical

Really

I thought they had ceased to exist a while ago. Last time I entered a Toys 'R' Us must've been during the early 00's, back when they still sold SNES games. I remember getting Super Wrestlemania. Terrible purchase.
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ehhwhatever posted...

So toysrus joins bed, bath and beyond and blockbuster video

Wtf B,B&B is still in business and is fucking amazing. Their coupons are the best

Dang, that sucks.
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This is actually really sad. Phones and video games can't replace the physical aspect of picking up a toy and playing with it based on your own imagination.

I say that as someone who has spent literal years of my life on a computer playing games.
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Hasbro and Mattel should make a portable with licensed games. I'm sure they'd do a bad job, but if they didn't, it'd be great.
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