Toys R Us, the iconic company which was founded in 1948 and grew to become the largest chain of toy stores in the US, is on its way to becoming a memory.
The toy retailer is said to be getting ready to liquidate its US operations and close all its stores in the country.
Toys R Us took its first step into bankruptcy in September with hopes of reducing its debt and coming up with a better business plan to save its operations. These efforts have gone in vain as the company has failed to secure a buyer and also to arrive at a suitable debt restructuring plan.
It appears the toy store chain is now considering shuttering its stores and closing its entire operation in the US. Things are not looking bright on the international side either. The company’s UK unit is now under administration, which is another form of bankruptcy, while the European and Asian divisions are likely to be sold. There has been no update on the Canadian operations as yet.
Toys R Us did not have a very merry Christmas either as the holiday sales fell far below expectations.
The plight of the retail industry is well known and Toys R Us has also been facing the same issues. However, apart from its failure to reinvent itself, the toy chain had a massive debt that kept eating into its system. The company’s plans to deal with this debt weren’t good enough.
The news of Toys R Us’ possible liquidation affected the stock of popular toy manufacturers Hasbro and Mattel negatively.
All hope is not lost though for the toy store chain, who unlike other large retailers, was ready to experiment with relatively novel items and ventures. If Toys R Us manages to get a buyer or lender, it can still be saved.
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