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Toys R Us bankruptcy filing?

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Comments

  • eggsheneggshen Middleton, WIMember Posts: 552
    I dislike leverage buyouts as much as the next guy,  but to be fair Bain Capital has also acquired other businesses that have succeeded.  Guitar Center, Burger King, Sealy, Dunkin Donuts,  Domino's, to name a couple.  Other people on this thread have talked about working at TRU over the years with negative reports, I think the top brass just made so many bad decisions over the years that it wasn't possible to save. Another toy retailer will rise from the ashes eventually.
    SumoLegopharmjodspepperOnebricktoomanystlux
  • CaptainRogersCaptainRogers Greensboro, NCMember Posts: 779
    @Tkatt I do! When TRU is brought up at my job, I will find out that folks my age (27) and older remember KB toys. I have a few fond memories of stopping in those stores on occasion.
    OnebricktoomanySeijiAmasawaLeeF
  • SumoLegoSumoLego New YorkMember Posts: 12,565
    eggshen said:
    ...I think the top brass just made so many bad decisions over the years that it wasn't possible to save...
    It's tough to compete with Amazon, Wal-Mart and Target without having crippling debt service payments.  Unless there was some radical shift in their business model after the last restructuring - and how would TRU realistically be able to adjust without increasing their debt or reducing revenue? - this was the more likely result. 

    Nobody has the appetite to restructure the debt again if the competition is willing to take losses (Amazon), ruthlessly increase margins from suppliers (Wal-Mart) or are zealots for efficiency (Target).  
    pharmjod77ncaachampsOnebricktoomanyFizyxSeijiAmasawa
  • 77ncaachamps77ncaachamps Aspiring Time Traveler Stuck in the West (US)Member Posts: 2,442
    edited March 2018
    eggshen said:
    I dislike leverage buyouts as much as the next guy,  but to be fair Bain Capital has also acquired other businesses that have succeeded.  Guitar Center, Burger King, Sealy, Dunkin Donuts,  Domino's, to name a couple.  
    All of which do not have to directly compete with Amazon, Target or WalMart.
    FizyxLeeF
  • madforLEGOmadforLEGO Chicagoland USMember Posts: 9,542
    I wonder if a silver lining to all of this is LEGO lowering its threshold to smaller outlets to allow for more official sellers of LEGO to make up for the lost space of TRU?
    Fizyx
  • eddieweddiew South JerseyMember Posts: 80
    So, my credit card rewards program is offering $100 in TRU giftcards (10x$10) for $75.00. Is this worth taking advantage of, or will I just be left with a pile of plastic?
  • CaptainRogersCaptainRogers Greensboro, NCMember Posts: 779
    @eddiew depends how quickly you could get it and spend it. Or, if you don't have the time, just get the deal and send the gift card numbers to me - I'll be sure to spend it very quickly! :) 
    Fizyx77ncaachamps
  • teal93mr2teal93mr2 USAMember Posts: 967
    eddiew said:
    So, my credit card rewards program is offering $100 in TRU giftcards (10x$10) for $75.00. Is this worth taking advantage of, or will I just be left with a pile of plastic?
    The 30 day clock for using reward dollars and gift cards started running a few days ago, I'd only purchase if you definitely have something in mind. 
    FizyxAstrobricksSumoLego
  • OubirdOubird OklahomaMember Posts: 51
    Free Shipping on website jumped from $35 to $99 this morning!
  • 77ncaachamps77ncaachamps Aspiring Time Traveler Stuck in the West (US)Member Posts: 2,442
    Oubird said:
    Free Shipping on website jumped from $35 to $99 this morning!
    Makes sense (kinda) since they’re no longer competing with online retailers...
  • eggsheneggshen Middleton, WIMember Posts: 552
    I spoke with one of the managers at my local store which was not on the initial list of store closings. She told me they will be shut down by April 15th. Not sure if that's just that store or all stores.  No sales to be seen yet she told me they don't know when they will start. The LEGO aisle is pretty wiped. She did say that their warehouses are full of stuff (including LEGO sets) and the stores are going to start getting merchandise dumped on them.
    SumoLegoLeeF
  • Ma1234Ma1234 Member Posts: 693
    eggshen said:
    I spoke with one of the managers at my local store which was not on the initial list of store closings. She told me they will be shut down by April 15th. Not sure if that's just that store or all stores.  No sales to be seen yet she told me they don't know when they will start. The LEGO aisle is pretty wiped. She did say that their warehouses are full of stuff (including LEGO sets) and the stores are going to start getting merchandise dumped on them.
    I bet they hold a beat. The Canadian unit is not closing and there is talk of integrating some of the U.S. stores into the Canadian operation. 
    SumoLego
  • SumoLegoSumoLego New YorkMember Posts: 12,565
    @Ma1234 - I was told the same thing from another channel.  Apparently, MGA Entertainment is purchasing Canadian operations of TRU, and is considering cherry-picking the worthwhile stores the US. 

    (I'm not sure how you could operate the distribution system for the US with a limited number of stores - but there are far smarter people that can figure out those logistics.)

    The liquidators take over as early as Thursday, with the official closing date of April 15th.  The retail warehouses are supposedly empty, with all excess product being available at the remaining locations.  Employees in most states are required to be paid for 60 days after the final day the store is open.  In New York it is 90 days, then eligibility for unemployment.

    Also, they already cut loose most of the folks at TRU HQ.  

    Any deals would start on Thursday - but with the 'run' on people using up gift cards and points, I wouldn't expect any desireable LEGO to remain.  My local store still has the above RRP on everything.

    (Maybe I'll finally buy those four Chima sets that have been on a 5% clearance price off of their 10% TRU inflated RRP...)
    madforLEGOfloridabrickLeeFOnebricktoomany
  • BrickByBrickBrickByBrick Massachusetts, USAMember Posts: 660
    Mine had tons of Bucket Wheel Excavators... Wasn't expecting that. They had several Technic Porsche's for $199 which I would have bought if I could afford to... Only other stuff they had in terms of Lego was several hundred Jyn Erso buildable figures for $9 and an entire isle of Laval Dimensions packs for $4.... Didn't buy anything because there wasn't much that was worth waiting in the massive line for.
  • datsunrobbiedatsunrobbie West Haven , CTMember Posts: 1,528
    I stopped in at the Milford, CT Toys R Us on Saturday. It was the first time I have ever seen the parking lot completely full. I did not see any markdowns on LEGO, or anything else for that matter, but people were lined up 20 deep at the registers.
    LeeFSumoLegodehnehsuLEGO_Dad77
  • MugenPowerMugenPower Member Posts: 467
    They had several Technic Porsche's for $199 which I would have bought if I could afford to...
    Wow, I wish I would've seen the same deal at the stores I went to.  I haven't even seen that being sold in store before.  I visited 2 TRUs since the closing announcement and I didn't notice them having any special sales but the shelves were really starting to thin out already.

    One store I visited late last week was cleaned out of #30526 except for a lone one crumpled up like it was trampled and their stock of #30450 was also dwindling.  This same store had plenty of both just a few days prior.  The second store I visited yesterday still had plenty of both but not as many as when I visited exactly a week ago.

    I know there had been discussions in the polybag thread about these two, so I'd suggest getting to a TRU ASAP if you're still looking for those, particularly if you're looking for #30526 since I haven't seen that one anywhere else (I've seen #30450 at Walmart).
    LeeFFizyx
  • hleonffuhleonffu USAMember Posts: 232
    Mine had tons of Bucket Wheel Excavators... Wasn't expecting that. 
    Same for a store that is closing in CT, but there was no discount.
  • BrickByBrickBrickByBrick Massachusetts, USAMember Posts: 660
    Yeah, mine had a 10% discount, guy who worked there said Lego was finally allowing them to discount product to get it out, he was putting up signs while I was there
  • LeeFLeeF Walton, KYMember Posts: 8
    Went to my local store on Friday and Saturday. No sales and they had a sign up stating the sale prices would go into effect 3/22/18. I popped for three of the Speed Champions cars that my oldest son wants. That line is already wiped out at my local store and the location about 40 miles from me. I don't know who will get rights to sell the SC series at this point or if LEGO just opens it up to all retailers now. I'm disappointed in this development. It's been a long time coming. I'm thankful that my oldest son and I got to do some events at our location over the past few years. By my youngest (who just turned a year old this month) never got a chance. Our store still has the Easter event scheduled for 3/25/18 so I am taking them both to that and then I guess that's it for TRU memories with my sons. :(  The loss of these events (and the loss of jobs for nearly 30K employees), more than anything else, is what stinks about this. I enjoyed my memories as an older child and adult at TRU. Being able to share that with my kids was something I honestly treasured then and now. 
    jmeninnoLEGO_Dad77
  • eggsheneggshen Middleton, WIMember Posts: 552
    SumoLego said:

    The liquidators take over as early as Thursday, with the official closing date of April 15th.  The retail warehouses are supposedly empty, with all excess product being available at the remaining locations.  Employees in most states are required to be paid for 60 days after the final day the store is open.  In New York it is 90 days, then eligibility for unemployment.
    Thanks @SumoLego for the intel. I think the fact that you got this info from your source and I got conflicting info from my sources speaks volumes about why TRU is going under. Top brass can't even be bothered to do things correctly at all.

    They can't even communicate the company closing plan properly to the local staff and I find that very disrespectful: "Sorry you are losing your job that you've had for the last 10 - 20 years, your last day will be April 15th, or maybe May 15th, but you will get paid through June 15th. Or maybe April 15th, we aren't too sure. At least you can take advantage of the sales that will start next week. Or possibly the week after. And we have a ton more merchandise coming, the warehouses are full. Or maybe they aren't. Can I have my CEO bonus now so I can go on vacation before I start my new job as CEO of another company I'm going to run into the ground by saddling them with ridiculous amounts of debt?"
    BrickByBrickstluxFizyxLeeFMynattSumoLegoOnebricktoomanytomahawkerLEGO_Dad77
  • SumoLegoSumoLego New YorkMember Posts: 12,565
    There are a number of TRU warehouses, so who knows what stock they are referring to.  Old information tends not to get updated - particularly when everything is in transition.

    Maybe there will be a buyer, maybe not, but they still have to move forward with the process.  One can always buy more product.

    The other day it was funny to see the Pokemon merchandiser packing up all of their product.  (TRU gets a percentage of sales of the product - and doesn't actually own the product!)
    FizyxOnebricktoomany77ncaachampsLEGO_Dad77
  • Ma1234Ma1234 Member Posts: 693
    As expected, a plan to merge 200 or so strong performing U.S. stores with the healthy Canadian operations could be determined shortly.

    https://www.axios.com/toys-r-us-fate-could-be-decided-tomorrow-1521471716-e477e089-c89a-4179-9aa9-739ad711b5e1.html 


    LEGO_Dad77
  • FizyxFizyx ColoradoMember Posts: 824
    SumoLego said:
    One can always buy more product.

    While true in the long term, I feel like in the short term there were some bridges burnt prior to and during the bankruptcy proceedings based on some of the news about supplier payments that has come out, and this might not actually be an option at the moment in some cases... Or, at least not under current ownership and management.
  • SumoLegoSumoLego New YorkMember Posts: 12,565
    The toy market is highly competitive - I don't know too many toy wholesalers that would turn down shelf space in 200+ locations.  

    (They may just be more careful about how they supply their product.)
    madforLEGOFizyx
  • madforLEGOmadforLEGO Chicagoland USMember Posts: 9,542
    edited March 2018
    Ma1234 said:
    As expected, a plan to merge 200 or so strong performing U.S. stores with the healthy Canadian operations could be determined shortly.

    https://www.axios.com/toys-r-us-fate-could-be-decided-tomorrow-1521471716-e477e089-c89a-4179-9aa9-739ad711b5e1.html 


    Would like to see this occur, this is the reset I think TRU really needed to begin with. 200 stores would help focus product and store changes, all the while TRU.com likely sticking around as well (albeit possibly with a different name), never mind the jobs it saves
    Onebricktoomany
  • SumoLegoSumoLego New YorkMember Posts: 12,565
    I sure hope one stays open in my area.  It is pretty close to Canada.
    OnebricktoomanySprinkleOtter
  • pharmjodpharmjod 1,170 miles to Wall Drug, USAMember Posts: 2,899
    I would like to see it happen too. When I worked for the company 20 years ago the store closest to me now was always one of the best performing ones in the state. I expect it will stick around if the stores merge.
    Onebricktoomany
  • Ma1234Ma1234 Member Posts: 693
    Bloomberg is now reporting that Toys R Us will hold off starting liquidation sales at its top ~200 performing stores in hope that they are sold with the Canadian unit. 
    Onebricktoomany
  • 77ncaachamps77ncaachamps Aspiring Time Traveler Stuck in the West (US)Member Posts: 2,442
    edited March 2018
    Amazon possibly in play...Hopefully, this would mean a B&M location with a toy aisle. Maybe not as comprehensive as TRU's but something other than WM and Target.

    https://www.bloomberg.com/news/articles/2018-03-19/amazon-is-said-to-have-mulled-acquiring-some-toys-r-us-stores
  • SumoLegoSumoLego New YorkMember Posts: 12,565
    Does Amazon still have boutique stores around the US?  

    I find it incredulous that they would consider the fractured parts of TRU to be their jumping-in point for retail locations.  (I could see wanting to acquire the distribution network, but I'm pretty sure they have a more efficient one already in place.)
    OnebricktoomanySeijiAmasawa
  • madforLEGOmadforLEGO Chicagoland USMember Posts: 9,542
    So it sounds like, according to thebrickfan.com, that LEGO will be marked as DO NOT LIQUIDATE, at least the newest sets that LEGO can likely get back and sell themselves. Not surprising if this turns out to be the case, as TRU owes a lot of money to LEGO.
    77ncaachampsOnebricktoomany
  • 77ncaachamps77ncaachamps Aspiring Time Traveler Stuck in the West (US)Member Posts: 2,442
    SumoLego said:
    Does Amazon still have boutique stores around the US?  

    I find it incredulous that they would consider the fractured parts of TRU to be their jumping-in point for retail locations.  (I could see wanting to acquire the distribution network, but I'm pretty sure they have a more efficient one already in place.)
    They do.

    But that's why the article mentions that they're going to select the stores in the markets that are appealing.

    Amazon bought Whole Foods for their food distribution, why not a TRU and change it for a package pick-up location and quasi-store?

    Having lockers all over the place means multiple stops for the driver, wasted time, and more management.

    Having a HUGE locker space (a repurposed TRU) may be more beneficial: the square footage can handle returns, store larger items, and the parking lots are already large enough to accommodate customers.
    Onebricktoomanyprevere
  • SumoLegoSumoLego New YorkMember Posts: 12,565
    edited March 2018
    It's more likely to protect the retail value of new sets for Wal-Mart, Target, [email protected], the LEGO Retail Store and other online partners.

    Although TRU moves a lot of product, they're not in the business of extending substantial amounts of product on credit.  Otherwise, LEGO would have their Retail Merchandiser network (or an entity like National Merchandising) out at the stores packing up product.

    I noticed merchandisers for the book company inventorying and packing up all of the books at TRU. 
    Onebricktoomany
  • Game_onGame_on USAMember Posts: 92
    I stopped into our local TRU last weekend to pick up a few Speed Champions sets. 
    The place was PACKED!  (Not really surprised considering whats going on)

    I picked up the new Porsche RSR #75887 along with the Mercedes AMG-GT3 #75877.
    I also picked up the Ninjago Movie Spinjitzu Training set and a poly bag of the Milano.

    The aisle really looked picked over considering nothing was marked down except for the Brick Heads.  
    LeeF
  • SumoLegoSumoLego New YorkMember Posts: 12,565
    edited March 2018
    77ncaachamps said:
    ... But that's why the article mentions that they're going to select the stores in the markets that are appealing...
    There are much cheaper ways to secure 'locker' space short of assuming all of the cost of the TRU network.  Retail space is available all over the place at competitive pricing.

    It makes one wonder that absent the crushing debt service, could a mediocre national toy retailer exist?  Or is it just a non-starter?
  • madforLEGOmadforLEGO Chicagoland USMember Posts: 9,542
    SumoLego said:
    77ncaachamps said:
    ... But that's why the article mentions that they're going to select the stores in the markets that are appealing...
    There are much cheaper ways to secure 'locker' space short of assuming all of the cost of the TRU network.  Retail space is available all over the place at competitive pricing.

    It makes one wonder that absent the crushing debt service, could a mediocre national toy retailer exist?  Or is it just a non-starter?
    The key word is 'mediocre'. If you get competent leadership I think a national toy retailer could exist. IMO the problem is that Bain took the money, ran, and left TRU beaten in the alleyway. I think if you get a real leader who could start with a clean slate TRU could do well enough.
    FizyxeggshenSumoLegoLeeF
  • daewoodaewoo TexasMember Posts: 388
    SumoLego said:
    77ncaachamps said:
    ... But that's why the article mentions that they're going to select the stores in the markets that are appealing...
    There are much cheaper ways to secure 'locker' space short of assuming all of the cost of the TRU network.  Retail space is available all over the place at competitive pricing.

    It makes one wonder that absent the crushing debt service, could a mediocre national toy retailer exist?  Or is it just a non-starter?
    The key word is 'mediocre'. If you get competent leadership I think a national toy retailer could exist. IMO the problem is that Bain took the money, ran, and left TRU beaten in the alleyway. I think if you get a real leader who could start with a clean slate TRU could do well enough.

    I agree.  My preferred TRU is clean, has a knowledgeable staff with tenure (a few have over 20 years with TRU), is well-organized, and is kept well stocked.  My only complaint is with the company's pricing policies.  If they were more competitive in that regards I would have made more of my purchases there.  
    FizyxLeeF
  • SumoLegoSumoLego New YorkMember Posts: 12,565
    daewoo said:
    My only complaint is with the company's pricing policies.  If they were more competitive in that regards I would have made more of my purchases there.  
    That's the paradox - it's the symptom and the solution.  Subtle price increases to try and increase revenue to pay for prior bad decisions that result in debtload...
    Fizyx77ncaachamps
  • FizyxFizyx ColoradoMember Posts: 824
    SumoLego said:
    daewoo said:
    My only complaint is with the company's pricing policies.  If they were more competitive in that regards I would have made more of my purchases there.  
    That's the paradox - it's the symptom and the solution.  Subtle price increases to try and increase revenue to pay for prior bad decisions that result in debtload...

    It's certainly a symptom, but I don't know about the solution part.  Arguably they would have been much better off focusing on something like increasing brand loyalty/repeat sales to drive up sales volumes, removing the need for any price increases over RRP in most cases.  Especially for LEGO, whose MSRP is something that is easily discovered, AND can be obtained at that MSRP or cheaper very easily for 99% of sets, seeing prices even slightly over that decreases my trust in the store and turns it very quickly into a last resort purchase destination for ANY item.
    jnscoelho77ncaachampsPumpkin_3CK5
  • eggsheneggshen Middleton, WIMember Posts: 552
    They should have taken the Walmart approach and gone for volume over margin. They should have closed all of their BRU stores 10 years ago (there's a reason the vast majority of the list in January were BRU stores). Also, they should have eliminated all of the "premium" brands and gone for middle tier goods. No one is going to TRU to buy $2500 trampolines and playsets or $20 Mcfarland collectibles. 

    I'm hoping a better toy store rises from the ashes.
  • BumblepantsBumblepants DFWMember Posts: 6,157
    Lego is a premium brand...
  • eggsheneggshen Middleton, WIMember Posts: 552
    edited March 2018
    Lego is a premium brand...
    Very true. I'm talking about all the super expensive stuff no one ever buys. The huge outdoor play sets, the Mega Construx TMNT Terrordrome, drones, kids clothing, Meccano robots, etc. Even high end LEGO sets. There's a stack of Silent Mary sets that aren't moving at my local store. They needed to have an upper limit on certain categories. Seems like they kept getting stuck with expensive stock that then got marked down at least 50% off.

    There are other brands I've seen (especially in the arts and crafts area and infants) that I always see in the clearance aisle but I don't remember the names. Oh, and they were also terrible at buying board games. How many clearance endcaps has everyone else seen over the years of junk games like Dino Stomp, Gooey Louie or Doggie Doo? 

    Fao Schwartz(sp?) Was also an unnecessary category. No one was going to pay $100 for a floor piano regardless of the name on it.
  • MugenPowerMugenPower Member Posts: 467
    eggshen said:

    Very true. I'm talking about all the super expensive stuff no one ever buys. The huge outdoor play sets, the Mega Construx TMNT Terrordrome, drones, kids clothing, Meccano robots, etc. Even high end LEGO sets. There's a stack of Silent Mary sets that aren't moving at my local store. They needed to have an upper limit on certain categories. Seems like they kept getting stuck with expensive stock that then got marked down at least 50% off.

    I think stocking the super expensive stuff is up to the discretion of the actual store, not really overall TRU policy, per se.  For instance, one of the stores I go to usually carries the really expensive and large Lego sets while another one I go to rarely ever does.  And they aren't even store returns as they typically have multiple copies of them.  That same store also carries a lot more of the really expensive Transformers toys and diecast cars than the other store.  I see the same at other TRUs that I go to infrequently; the quantity of "high end" merchandise varies across the board.  It could just be that the store you normally go to chose to consistently order the really expensive stuff.
  • daewoodaewoo TexasMember Posts: 388

    The demographics of the area certainly play a role in what is stocked.  Stores in affluent areas will carry more of the higher end stuff whereas a store in a less well-off area will focus more on affordable items.   

  • AstrobricksAstrobricks Minnesota, USMember Posts: 2,759
    Also, if you want to be a destination store that excites customers enough to shop there instead of online, it would be best to have the big expensive stuff, even if you don’t move a lot of it. 
  • madforLEGOmadforLEGO Chicagoland USMember Posts: 9,542
    Yeah, but wasn't TRUs over pricing of LEGO due more to trying to pay off debt than trying to squeeze consumers?
    Once upon a time, TRU had great LEGO deals like BOGO50 and B2 get 1 free before Bain moved in.
    gmonkey76
  • teal93mr2teal93mr2 USAMember Posts: 967
    Yeah, but wasn't TRUs over pricing of LEGO due more to trying to pay off debt than trying to squeeze consumers?
    Once upon a time, TRU had great LEGO deals like BOGO50 and B2 get 1 free before Bain moved in.
    Amen to that.  The BOGO50 on #10188 and #10217, among other exclusives was clutch!
  • 77ncaachamps77ncaachamps Aspiring Time Traveler Stuck in the West (US)Member Posts: 2,442
    There's a nostalgia for the stores of our youth: walk around and look at all of the cool stuff on shelves or behind glass cabinets.

    Is this something kids these days (and of the future) want or find valuable?
    This will change the way TRU or any toy store decides to approach their brick and mortar model.
  • ricecakericecake Maryland, USAMember Posts: 879
    I've been seeing news that KB Toys may be coming back with some pop-up stores around the holidays, with the potential of some of them becoming permanent stores.
    http://money.cnn.com/2018/03/20/news/companies/kb-toys-toys-r-us/index.html

  • alaskaguyalaskaguy Member Posts: 335
    edited March 2018
    One thing that might have saved TRU would be if they turned themselves into play centers where you could also buy stuff.

    Consider - you pay a fee (daily, monthly, yearly) for admission to the play area, where you can play with certain things - where the certain things are rotated periodically to provide variety and keep you coming back. This is already done by various toy clubs, including Lego specific toy clubs.  However, TRU would ALSO have the toy show room - where you can then BUY stuff you like, and parents see you playing with - and maybe strike while the moment is hot.  It ALSO gives parents a way to shop for toys while keeping their kids occupied. Also birthday party area, events, etc. It also provides some reoccurring revenue, a way to actually ENGAGE with customers.  It could get a lot of people into the store that otherwise wouldn't be there - and that increased exposure provides an opportunity to convert people into product customers.

    All of this is relatively cheap and easy to do, is something that can't be done by on-line only retailers, and not easily done by general-purpose retailers like Walmart and Target.  Yes, it requires the stores to give up some square footage from the sales floor, but you don't get something for nothing. In any event, I think they should have given something along these lines a go.  Added bonus points if they could turn some of their parking lot area into an outdoor playground, to make the idea usable for a wider variety of toys.
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