Surely, many of you have bought toys for your children in a Toys R Us store. Today we learned that the toy chain, has declared bankruptcy not being able to face a debt of 5,000 million dollars (about 4,170 million euros).
However, the company, which has 1,600 stores worldwide (52 stores in Spain), continue with your business activity. He plans to use this process to restructure his debt and reorganize himself to obtain long-term growth, according to the company.
The tough competition of online sales
Toys R Us' decision to declare bankruptcy comes before the start of the Christmas campaign, the most important of the year for the sector, which concentrates a quarter of annual sales.
The company was affected by the change of buyers habits, which increasingly prefer buying through the internet or in chains with low prices and discounts. He has not been able to deal with the tough competition of giants like Amazon, leader in online sales, which only last year increased toy sales by 24%.
As stated by Dave Brandon, President and CEO of Toys R Us in the statement
"Our goal is to strengthen our competitive position in an increasingly challenging and changing retail market. We are confident that these are the right steps to ensure that the iconic Toys" R "Us and Babies" R "Us brands live for many generations."
The chain, which in Spain it has 52 and 1,600 employees, has launched a process to restructure its commercial network that contemplates the closure of the less profitable premises and improve existing ones to make the user experience more special, they have informed Efe-Dow Jones knowledgeable sources of the process.
Meanwhile, all stores they will continue selling their toys as usual, as well as the Babies R Us division and the chain's online stores.
Toys R Us in Spain
We have contacted Toys R Us Spain who have told us the following:
Toys ”R” Us and Babies ”R” Us stores throughout the world continue to operate normally during the financial restructuring process in the USA and Canada. In the case of Spain, this measure will not affect the business or stores in our country. The company has future projects and investments to improve services and currently, Management and teams are focused on the next Christmas campaign.
