An era of American toy-shopping has ended.
Toys “R” Us has gone away. Its approximately 1,600 stores in and outside the United States are all closed for good.
Toys “R” Us was taken over by private investors in a leveraged buyout in 2005—shortly before the financial crash—which left the company heavily weighted with debt. Taste in toys was changing and the company was not able to follow trends—all its income went to debt service.
By the time that agreement ended in 2015, Amazon was the biggest toy seller online, and Toys “R” Us was too deep in corporate debt to build its own online business.
The shift to consumer electronics-based gaming also caught Toys “R” Us off guard. Again, the company didn’t have the cash to expand into a new field.
Toys “R” Us tried management restructuring, finding new sources of credit—anything to keep the once dominant retailer alive. Nothing worked.
Worse still, the bankruptcy was announced at the start of the 2017 holiday toy-shopping season, creating an atmosphere of death and despair which kept shoppers away from the stores through the all-important holiday season.
After a holiday season it called “well below worst-case projections,” the company decided to close all its stores.
Friends Read Free