Toys ‘R’ Us, Back From the Dead, Will Open U.S. Stores in 2019

Share on facebook
Share on google
Share on twitter
Share on linkedin
A VPN is an essential component of IT security, whether you’re just starting a business or are already up and running. Most business interactions and transactions happen online and VPN
Toys ‘R’ Us, Back From the Dead, Will Open U.S. Stores in 2019

Maybe American kids will only have to live through one Christmas without Toys “R” Us.

About a year after shuttering U.S. operations, the remnant of the defunct toy chain is set to return this holiday season by opening about a half dozen U.S. stores and an e-commerce site, according to people familiar with the matter.

Richard Barry, a former Toys “R” Us executive who is now CEO of new entity Tru Kids Inc., has been pitching his vision to reincarnate the chain to toymakers, including at an industry conference this week, said the people, who asked not to be identified because the plans aren’t public.

The stores are slated to be about 10,000-square feet, roughly a third of the size of the brand’s big-box outlets that closed last year, the people said. The locations will also have more experiences, like play areas. The startup costs could be minimized with a consignment inventory model in which toymakers ship goods but don’t get paid until consumers buy them, some of the people said.

A spokeswoman for Tru Kids said the company wasn’t ready to publicly share details on its U.S. strategy.

New Rivals

It remains to be seen how much of a boost the retailer’s comeback will provide the toy industry, including giants such as Hasbro Inc. and Mattel Inc. The original Toys “R” Us, the only national toy chain, left a huge holewhen it went under. It had been generating about $7 billion in sales a year in the U.S. through more than 700 locations, including the Babies “R” Us brand.

Walmart Inc.Target Corp. and Amazon.com Inc. have swooped in to fill the void. They have all expanded toy assortments and marketing, including a printed toy catalog from Amazon. Other non-traditional chains jumped into the category, including grocery stores and Party City Holdco Inc.

There is also a question of how many toymakers will do business with the new Toys “R” Us after many lost money when the former company announced liquidation in March 2018, just months after filing for bankruptcy.

MGA on Board

MGA Entertainment Inc., one of the best-performing toymakers in the world, is already on board to sell at the re-imagined Toys “R” Us shops, said Chief Executive Officer Isaac Larian, who said he has been pitched the plan. His company’s properties include Little Tikes, L.O.L. Surprise! and Bratz dolls.

“This market needs a self-standing toy store, that’s for sure,” Larian said in an interview. “We will sell them inventory.”

Related: Tears ‘R’ Us: The World’s Biggest Toy Store Didn’t Have to Die

During the chain’s bankruptcy, lenders led by Solus Alternative Asset Management and Angelo Gordon took control of the company’s assets. After results didn’t improve, they opted to shutter operations in the U.S. Units in Australia and other regions also closed, with divisions in Asia and Canada acquired by new owners.

This group tried to sell the intellectual property, but opted to keep it to garner a better return. As owners of the intellectual property, they have been collecting licensing and other fees from the units still operating and selling them private-label goods. The lenders then formed Tru Kids with the goal of reviving the brand in the U.S. and other regions it exited. It has since hired several industry veterans and signed a deal to bring Toys “R” Us and Babies “R” Us back to Australia through a partner.

https://www.bloomberg.com/news/articles/2019-06-21/toys-r-us-back-from-the-dead-will-open-u-s-stores-in-2019
Finance Team

Finance Team

Leave a Replay

0 0 vote
Article Rating
simple-ad

This is a demo advert, you can use simple text, HTML image or any Ad Service JavaScript code. If you're inserting HTML or JS code make sure editor is switched to "Text" mode.

Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments

Sign up for our Newsletter

Click edit button to change this text. Lorem ipsum dolor sit amet, consectetur adipiscing elit