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Toys 'R' Us Has Filed For Bankruptcy Protection

Toys 'R' Us Has Filed For Bankruptcy Protection

By Ambia Staley

Following days of rumours, it's now official -- Toys 'R' Us has filed for bankruptcy protection.

Late Monday night, the toy retailer announced that they have filed for Chapter 11 bankruptcy protection in the U.S. and that they intend to follow suit in Canada.

Dave Brandon, company CEO said in a statement, "Together with our investors our objective is to work with our debt-holders and other creditors to restructure the $5 billion of long-term debt on our balance sheet, which will provide us with greater financial flexibility to invest in our business ... and strengthen our competitive position in an increasingly challenging and rapidly changing retail marketplace worldwide."

Despite the filing, the company claims that Toys 'R' Us and Babies 'R' Us stores will continue to run as usual. Customers will also be able to continue shopping online for their toys and baby products. The company also stated that it's committed to working with vendors to make sure their inventory levels are maintained.

Toy's 'R' Us employs nearly 65,000 people worldwide and runs approximately 80 stores across Canada and 880 stores in the United States. They also have approximately 780 international stores and more than 245 licensed stores -- none of which are impacted by the filings in the U.S. or Canada. While Toys 'R' Us maintains that it intends to run as usual, there is no official word about whether the company has plans to close unprofitable stores, or lay off any of its employees.

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    • I wonder if the new owners will open any Christmas rush pop up stores. (small express stores with mainly the top "in demand" toys of the current year only, plus a few other hot selling items)
      The previous owner gave it a try.
      Some locations actually looked very busy while others were a total flop. Hit and miss, I suppose.
      Pop-up stores and stores-within-stores are two of the things they are supposed to be doing. They will also be hosting birthday parties in the store. All good ideas IMO.

      They are trying to make going to the toy store an experience again.
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    • Was in Toys r us today. They are fixing it up and changing the cashier system. Looks like the new owners are doing great.
      I wonder if the new owners will open any Christmas rush pop up stores. (small express stores with mainly the top "in demand" toys of the current year only, plus a few other hot selling items)
      The previous owner gave it a try.
      Some locations actually looked very busy while others were a total flop. Hit and miss, I suppose.
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    • Was in Toys r us today. They are fixing it up and changing the cashier system. Looks like the new owners are doing great.
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    • With the biggest toy retailer out of business, maybe this means that Hasbro and Mattel products are about to get hit with big discounts from too much inventory and distribution problems???
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    • There are potential buyers but they need to reach a deal. These things don’t stay on the table forever.

      The guy floating the deal tried to crowdfund part of it - that is not the greatest sign: https://www.gofundme.com/helpsavetoysrus

      Note that this is for a larger scope than just the Canadian op and that $200M of the $200.04M raised so far is the money of the guy that started the campaign :)
      If he's raising money for the transaction that tells me he has no plans of keeping the Cdn operations as is as the investors will want a return and that will be done by selling off the assets such the real estate holdings. If TRU does stay around in Canada I see it with the majority of the stores closing, selling the real estate and keeping a few of the profitable stores opened (unless those also have the highest real estate returns)
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  • mbg
    • read toys r us canada is doing very well and they expect a buyer. they have no plans to close Canadian operations
      There are potential buyers but they need to reach a deal. These things don’t stay on the table forever.

      The guy floating the deal tried to crowdfund part of it - that is not the greatest sign: https://www.gofundme.com/helpsavetoysrus

      Note that this is for a larger scope than just the Canadian op and that $200M of the $200.04M raised so far is the money of the guy that started the campaign :)
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    • I remember them saying that about Sears Canada vs Sears USA...

      Management teams can never be trusted.
      sears canada was bled dry by lampert. he siphoned billions from them. they would still be around if it wasn't for him. and dont shoot the messenger. besides where did you ever read sears canada was doing well? lol
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    • read toys r us canada is doing very well and they expect a buyer. they have no plans to close Canadian operations
      I remember them saying that about Sears Canada vs Sears USA...

      Management teams can never be trusted.
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    • read toys r us canada is doing very well and they expect a buyer. they have no plans to close Canadian operations
    • Report Post
    • I've read about this. It's kinda sad though, considering that most of us here grew up with Toy 'R' Us, and although we have no use for it anymore, the reminiscent memories would always be there. Shame they have to go, but they just aren't keeping up with the times.
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    • + 1
      I believe they just improved their website until these 2 years as well, shipping used to be expensive and many items only available in the stores
      Now their website is the opposite, it will say online only and not available in store but you go to the store and they have tons of stock.
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    • It wasn't until recent years I have been going to Toys R Us more often. Their sales are pretty good, but regular prices are too high.
      + 1
      I believe they just improved their website until these 2 years as well, shipping used to be expensive and many items only available in the stores
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    • Toys R Us has always been somewhat pricey, at least their video games. If the company was somewhat better managed, they would have put more energy into the buying and selling of new and used video games. If that crappy EB games store can survive then Toys R US would have been fine.

      I never really understood the appeal of buying Toys online. The joy of buying Toys is taking your kids there and trying things in person. Didn't anyone ever see the movie "BIG"?

      I think the real story is how much kids are now into smartphones and tablets and electronics. I know of some kids as young as 8 with smartphones and Dataplans. I think that is disturbing.

      I predict that in 100 years, all newborns will receive a datachip planted into their brains. The chip will do everything from monitor the baby's health to downloading Virtual reality based video games.
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    • It wasn't until recent years I have been going to Toys R Us more often. Their sales are pretty good, but regular prices are too high.
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    • We will be in trouble when the babies and toddlers are finally kids.
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    • I wonder if there's a market out there for "Gift Card Insurance"; ie you buy the gift card from Company X for Store Y. Company X charges a small fee. If the company goes out of business, Company X buys your gift card back for full value. Alternately, Store Y is charged the small fee instead; like any insurance, the fee could be based on the likelihood of bankruptcy.
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    • I'm hoping it survives in Canada. The one in Vaughn mills has always got a few ppl in there buying things. Amazon and walmart are really bad for toys . Some toys are triple the price on Amazon then they are in toys r us. I guess they get suckers who buy them. Plus my kids love going in there to see the toys.
      +1 they are the only ones around here that have life like stuffed animals. So lifelike a couple of visiting cats actually thought it was the real thing. I recently got another stuffed dog from them and thinking of getting a stuffed cat next.
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    • Reputation is not the same as trust. The brand will stick into your memory forever. If you don't open it, your competitor will open it and take the market share from you. That's why Brick and Mortar store is very important unless everybody will stay home and not going outside in the future.

      The VR you talk about already existed which is including the measurement on movement of full body. However, it is very expensive and take a while to do the full measurement. It is now mostly used to train athlete on country level. However, if you ever work in fashion industrial, then you will know accurate measurement doesn't necessary mean comfortability. No matter how accurate your measurement, it is totally different story once you wear the clothes or shoes. Fashion style is one of the key factor to impact the comfortability. Real tailor made clothing requires repeating steps of "test and measurement". One step measurement is not going to work. People working on tailor made clothing will understand what I mean. However, if the clothes preset into certain size like (S, M, L), then using VR to find the best fit will work.
      That's how it use to be with brick and mortar stores but not so much anymore, I think we are at a turning point. We don't need brick and mortar now to start to trust a company. If we don't like the product we return it for a full refund. There are so many people reviewing products now a days too. We do a lot of second hand buying; taking advice from other peers or people that we trust.
      As for VR, I'm not talking VR as we know it now. I'm talking VR of the future. Where our whole body is measured or scanned and registered with a VR database. I'm imagining this VR company being it's own seperate entity that all companies need to register with to keep clothes and shoes at spec. Not only that but this company will provide customized accessories for your body with haptic feedback. So you can try on those new shoes at home and really experience how they feel.
      I just can't see the future where people need to drive to stores to try on a pair of shoes or a new dress jacket or a bathing suit. We have the ability to manipulate our senses right now but we are not using this technology to its full extent. Future VR will definitely allow us to do this.
      It's all baby steps unfortunately.
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    • Brick and Mortar stores are used to build the long term reputation of a business and capture market shares. This is the same money allocated for advertising of a business.

      VR clothes service will not be able to help customers on fitness of clothing. We are not static, we are a moving object. As we move, we can experience the comfortability of the clothes. This can be found out ONLY if customers actually try on the clothes. Same thing happen to shoes. A shoe fit to you doesn't mean you will feel comfortable when you run or walk. Nevertheless, the VR can offer customers visual advice on clothing.
      That's how it use to be with brick and mortar stores but not so much anymore, I think we are at a turning point. We don't need brick and mortar now to start to trust a company. If we don't like the product we return it for a full refund. There are so many people reviewing products now a days too. We do a lot of second hand buying; taking advice from other peers or people that we trust.
      As for VR, I'm not talking VR as we know it now. I'm talking VR of the future. Where our whole body is measured or scanned and registered with a VR database. I'm imagining this VR company being it's own seperate entity that all companies need to register with to keep clothes and shoes at spec. Not only that but this company will provide customized accessories for your body with haptic feedback. So you can try on those new shoes at home and really experience how they feel.
      I just can't see the future where people need to drive to stores to try on a pair of shoes or a new dress jacket or a bathing suit. We have the ability to manipulate our senses right now but we are not using this technology to its full extent. Future VR will definitely allow us to do this.
      It's all baby steps unfortunately.
    • Report Post
    • Brick and Mortar stores are used to build the long term reputation of a business and capture market shares. This is the same money allocated for advertising of a business.

      VR clothes service will not be able to help customers on fitness of clothing. We are not static, we are a moving object. As we move, we can experience the comfortability of the clothes. This can be found out ONLY if customers actually try on the clothes. Same thing happen to shoes. A shoe fit to you doesn't mean you will feel comfortable when you run or walk. Nevertheless, the VR can offer customers visual advice on clothing.
      Walmart can't compete with Amazon right now. If Walmart has any sort of chance they need to restructure their business model fast.
      I think VR shopping is the way to go for Walmart next especially for people that need the visual appeal. That way they can change their brick and mortar stores into warehouses and delivery services. For example the VR clothes service: put in the dimensions of your body and as long as clothing company's register with the VR program you could try on clothes online and have a perfect fit.
      Amazon is going the opposite way and opening up brick and mortar stores which in the long run I don't think is a good idea even if it's cashierless. I guess time will tell.
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    • You never know what will happen next as Toys R Us in Canada is looking for buyer. You never know what will be the new rules about gift cards set by the new owner. With many uncertainty, it is better to use it asap.

      If the new owner does the same way as it now, even the stores in Canada will not survive very long. They need to spend money on investment creating new generation of toys.
      Can OP please fix the thread title about needing to use gift cards? There's no rush to use them as there's no way Toys R Us in Canada will go under, and they're actually one of the top retailers here
    • Report Post
    • Can OP please fix the thread title about needing to use gift cards? There's no rush to use them as there's no way Toys R Us in Canada will go under, and they're actually one of the top retailers here
    • Report Post
    • I'm hoping it survives in Canada. The one in Vaughn mills has always got a few ppl in there buying things. Amazon and walmart are really bad for toys . Some toys are triple the price on Amazon then they are in toys r us. I guess they get suckers who buy them. Plus my kids love going in there to see the toys.
    • Report Post
    • Walmart can't compete with Amazon right now. If Walmart has any sort of chance they need to restructure their business model fast.
      I think VR shopping is the way to go for Walmart next especially for people that need the visual appeal. That way they can change their brick and mortar stores into warehouses and delivery services. For example the VR clothes service: put in the dimensions of your body and as long as clothing company's register with the VR program you could try on clothes online and have a perfect fit.
      Amazon is going the opposite way and opening up brick and mortar stores which in the long run I don't think is a good idea even if it's cashierless. I guess time will tell.
    • Report Post
    • I don't think this will happen. If it does it won't be for very long. Amazon is not unstoppable. Google and Amazon are both leaving a bad taste in my mouth with the shit they are pulling. Acting like babies with their services and products, and not playing well together; I'm sure I'm not alone. All it takes is a good idea and competition to drive the market value down.
      Good to see you're optimistic but I see it happening and really the only retailer with deep pockets to compete with Amazon is Walmart and every time Walmart defeats a competitor their prices go up.
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    • and Amazon prices will skyrocket after they're all gone since all they do now is price match the sales that TRU have.
      I don't think this will happen. If it does it won't be for very long. Amazon is not unstoppable. Google and Amazon are both leaving a bad taste in my mouth with the shit they are pulling. Acting like babies with their services and products, and not playing well together; I'm sure I'm not alone. All it takes is a good idea and competition to drive the market value down.
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    • I think we all knew this was coming. Box stores are going down.
      and Amazon prices will skyrocket after they're all gone since all they do now is price match the sales that TRU have.
    • Report Post
    • I think we all knew this was coming. Box stores are going down.
    • Report Post
    • “The interesting thing to note about Toys ‘R’ Us Canada is all the real estate they own. Someone could buy this company, flip off all the real estate and be sitting in a pretty comfortable position,” said Don Gregor, vice-president, Aurora Realty Consultants.

      Gregor said that some of the valuable real estate owned by Toys “R” Us in Canada includes a site directly south of CF Sherway Gardens, a location in Vaughan, one in Kitchener, one in Barrie and another in Hamilton, opposite the Lime Ridge mall.

      “This is an attractive company, just for its real estate holdings,” said Gregor, who estimates the value of its real estate at $150 million in Ontario alone.
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    • Toys R Us is closing every store in the U.S.A. and with it 30,000 jobs will be lost.
      https://www.washingtonpost.com/news/bus ... 01550db1e1


      Canada is a smaller market and will follow the same fate eventually. Toys R Us Canada is looking for a buyer to keep their operations going.
      https://www.thestar.com/business/2018/0 ... iness.html
      The difference between Sears Canada and Toys r us Canada is that Toys r us has an actual name of an actual company maintaining interest in buying the company.
      When Sears mentioned that they found someone to add groceries to their store they failed to mention who that would be.
      I think they outright lied. There was no grocery investor.
      At least Toys r us can honestly name a company showing interest. THAT is the difference.
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    • Toys R Us is closing every store in the U.S.A. and with it 30,000 jobs will be lost.
      https://www.washingtonpost.com/news/bus ... 01550db1e1


      Canada is a smaller market and will follow the same fate eventually. Toys R Us Canada is looking for a buyer to keep their operations going.
      https://www.thestar.com/business/2018/0 ... iness.html

      No.
      This is only in the States and the U.K.
      Toys R us Canada is solid and strong, also doing well with Babies r us.
      As long as MGA entertainment goes ahead and invests in Toys r us and babies r us Canada, the company will survive.
      The company is likely to also liquidate its businesses in Australia, France, Poland, Portugal and Spain, according to the recording. It’s already shuttering its business in the United Kingdom. That would leave it with stores in Canada, central Europe and Asia, where it could find buyers for those assets.

      A spokesperson for MGA Entertainment, a privately held toy and entertainment company based in California, confirmed on Wednesday that chief executive officer Isaac Larian and affiliated investors have made a bid for Toys “R” Us in Canada.

      Toys “R” Us began operating in Canada in 1983 and now has 82 stores across Canada, as well as two e-commerce sites, including Babiesrus.ca.

      “The interesting thing to note about Toys ‘R’ Us Canada is all the real estate they own. Someone could buy this company, flip off all the real estate and be sitting in a pretty comfortable position,” said Don Gregor, vice-president, Aurora Realty Consultants.
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    • Toys R Us failed to find a suitable buyer and will probably close all stores.
      Maybe avoid buying or receiving gift cards from Toys R Us.
      It is the next Sears.
      No.
      This is only in the States and the U.K.
      Toys R us Canada is solid and strong, also doing well with Babies r us.
      As long as MGA entertainment goes ahead and invests in Toys r us and babies r us Canada, the company will survive.
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    • Don't hold your breath. It's dead here, soon or later. UK stores are also dead. Canada will be no island.

      https://www.theglobeandmail.com/report- ... e38292661/
      I think someone over at MGA entertainment sees great benefit in owning Toys r us so they can heavily push their own toy line over Hasbro or Matel, but why do they need a store to do that?
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    • I hate to say "I told you so," but, well... 33,000 employees out the door.
      That's only in the States!
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    • I hate to say "I told you so," but, well... 33,000 employees out the door.
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