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The Toys R Us thread (update: no longer DEAD)
https://www.cnbc.com/2017/09/18/toys...ource=facebook
Toys R Us could file for bankruptcy as soon as this week, according to sources familiar with the matter. The sources noted that the bankruptcy plans are not definite, and both its plans to file and its timing could change. A bankruptcy would help simplify a capital structure made complex by its trio of financial owners. Toys R Us was acquired by private equity firms Kohlberg Kravis Roberts and Bain Capital Partners and real estate investment trust Vornado Realty Trust in 2005 in a deal valued at $6.6 billion. The three owners either declined to comment or did not immediately have a comment. The debt restructuring would help provide Toys R Us the financial flexibility to invest in its business as it repositions itself to combat a changing retail landscape. Addressing the retailer's debt load prior to the crucial holiday season could give its major vendors such as Mattel and Hasbro clarity into the company's long-term viability to help ensure the toymakers continue to stock its shelves throughout the holiday. Toys R Us has hired restructuring lawyers at Kirkland & Ellis to help address looming $400 million in debt due in 2018, CNBC had previously reported, noting that bankruptcy was one potential outcome. Kirkland declined to comment. |
re: The Toys R Us thread (update: no longer DEAD)
They almost certainly will file bankruptcy. Their bonds have dropped in value a great deal over the past month.
Unless some other company swoops in that wants the brand for themselves, I don't think the chain will be around in 3 years. |
re: The Toys R Us thread (update: no longer DEAD)
I think you mean TrU
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re: The Toys R Us thread (update: no longer DEAD)
They should just eBay all the SNES units getting shipped to them.
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re: The Toys R Us thread (update: no longer DEAD)
It's official. Chapter 11.
https://www.cnbc.com/2017/09/18/toys...ankruptcy.html They have almost 5 billion in debt. |
re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by DVD Josh
(Post 13159215)
They should just eBay all the SNES units getting shipped to them.
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re: The Toys R Us thread (update: no longer DEAD)
This news makes me sad when I think of memories as a kid, wondering up and down the aisles at the store in my local mall. But I haven't been in one in years and don't recall ever buying much there because their prices seemed so much higher than other retailers.
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re: The Toys R Us thread (update: no longer DEAD)
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re: The Toys R Us thread (update: no longer DEAD)
Ahh, while I also admit to not setting foot in one in many years, what I miss most is the "stocked to the ceiling" look and the clearance aisle of toys from years past. When the store looks like a Wal-Mart or Target and carries the same stock as a Wal-Mart or Target, what's the point of visiting a TrU?
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re: The Toys R Us thread (update: no longer DEAD)
I went to a Toys R Us earlier this year for the first time in ages. Aside from new toys the store honestly felt largely the same as it did when I was a kid. I was always more a fan of KB Toys to be honest but when my brother and I were younger and my parents took us on vacation going to Toys R Us was like an event (we never had one where I live).
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re: The Toys R Us thread (update: no longer DEAD)
I went in one yesterday to look for some arts and crafts supplies (they didn't have what I was looking for), and it was full of screaming children all running (or riding bikes) up and down the aisles. Total pandemonium. I barely escaped with my life.
Don't even ask me what Babies R Us looked like next door! *shudder* |
re: The Toys R Us thread (update: no longer DEAD)
This bankruptcy is having a major effect on the toy companies and their bottom lines.
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re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by PhantomStranger
(Post 13194114)
This bankruptcy is having a major effect on the toy companies and their bottom lines.
I've been seeing Amazon casualties here-and-there (in example, local hardware shops). People just aren't buying at retail stores. Toys R Us couldn't lean up enough to stay alive. I hope they can restructure under Chapter 11, get their debtors paid, and stay alive. But it's going to be an uphill battle to make the numbers work. I can't imagine how much has to be done to work on that much debt. First thing I could think of ... downsize the stores to KB Toys' size and consolidate excess inventory to Amazon. Don't hang onto the past identity just for vanity (I've seen that happen a lot ... including the aforementioned hardware shops). |
re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by Troy Stiffler
(Post 13194153)
$5B is serious. Lots of invoices are going to go unpaid. Sucks for Mattel and whatnot ... right down to the commercial real estate companies, unpaid payroll taxes, etc. It'd be interesting to see a list of their debts (though I don't know if that's ever made public).
I've been seeing Amazon casualties here-and-there (in example, local hardware shops). People just aren't buying at retail stores. Toys R Us couldn't lean up enough to stay alive. I hope they can restructure under Chapter 11, get their debtors paid, and stay alive. But it's going to be an uphill battle to make the numbers work. I can't imagine how much has to be done to work on that much debt. First thing I could think of ... downsize the stores to KB Toys' size and consolidate excess inventory to Amazon. Don't hang onto the past identity just for vanity (I've seen that happen a lot ... including the aforementioned hardware shops). |
re: The Toys R Us thread (update: no longer DEAD)
There is a Toys R Us shop in our local outdoor outlet mall and it's really the perfect size. I could see them down scaling to that size and still making it work. They just need to cut out some of the crap that they carry today and stick to stuff that sells.
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re: The Toys R Us thread (update: no longer DEAD)
Restructure? Seriously? Fuck off and die already. I'm so tired of these shit businesses filing bankruptcy over and over and staying open. If it's not profitable anymore, it needs to fucking die. That goes for Perkins and Gander fucking Mountain too. I'm still pissed we have Kmart stores here. Circuit City stores all disappeared when it went bankrupt though.
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re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by Viper187
(Post 13203665)
Restructure? Seriously? Fuck off and die already. I'm so tired of these shit businesses filing bankruptcy over and over and staying open. If it's not profitable anymore, it needs to fucking die. That goes for Perkins and Gander fucking Mountain too. I'm still pissed we have Kmart stores here. Circuit City stores all disappeared when it went bankrupt though.
It's how chains like KMart and others have hung around far longer than anyone thought possible. |
re: The Toys R Us thread (update: no longer DEAD)
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re: The Toys R Us thread (update: no longer DEAD)
This chain should die off. Their pricing is a joke. Was in there this weekend with gift cards for the GF's kids - everything I saw seemed to be marked up 15-40% from other stores.
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re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by bunkaroo
(Post 13253768)
This chain should die off. Their pricing is a joke. Was in there this weekend with gift cards for the GF's kids - everything I saw seemed to be marked up 15-40% from other stores.
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re: The Toys R Us thread (update: no longer DEAD)
Sad day. Going to Toys to pick out a new NES game after my birthday was something I massively looked forward to as a kid. And Toys was my first job at 14.
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re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by fujishig
(Post 13253830)
I am curious what you were buying and what you were comparing prices to (sale prices online?) They do have some markup, especially on their exclusives or hot items like lego, but they often do the old KB tactic of marking things up so their sales won't bring the prices too low. They carry a larger variety of toys than the other B&m stores and even Amazon, and as the last remaining dedicated toy store their death would have the toy companies be even more at the mercy of those stores.
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re: The Toys R Us thread (update: no longer DEAD)
+Action figures, Barbie dolls, board games, etc. I've had the same experience as you with TRU's prices generally being significantly higher than the same product from their competitors
Let's talk about the hot product from this Christmas. Fingerlings. TRU was selling them in store at 17.99. Everywhere else had them at the regular retail price of 14.99 |
re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by bunkaroo
(Post 13253904)
LEGO's, Nerf guns, Pokemon card box sets...they were all way higher than what I saw at Target or Amazon.
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re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by Obi-Wan Jabroni
(Post 13253917)
+Action figures, Barbie dolls, board games, etc. I've had the same experience as you with TRU's prices generally being significantly higher than the same product from their competitors
Let's talk about the hot product from this Christmas. Fingerlings. TRU was selling them in store at 17.99. Everywhere else had them at the regular retail price of 14.99 You may say oh, that's Marketplace sellers. But amazon has just recently started putting variable demand based pricing on toys. Say a Marvel Legends set has six characters, you'll see the most popular one sell out first, then you'll see it get relisted, from amazon, for higher than the rest, then higher. So it's not like Amazon is a paragon of keeping prices at retail. They do blow out Lego and Nerf guns, though, it's pretty amazing the kinds of discounts they have. |
re: The Toys R Us thread (update: no longer DEAD)
Rip, tru. :(
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re: The Toys R Us thread (update: no longer DEAD)
To be a little less vague, reports today are that TRU may liquidate all operations as early as next week:
http://money.cnn.com/2018/03/09/inve...tel/index.html |
re: The Toys R Us thread (update: no longer DEAD)
Toys Were Us?
I worked for them as a seasonal temp during Christmas 1995, one of the worst jobs I ever had. I was stuck in the back where it was freezing, unloading trucks with a bunch of ex-cons, some of which had been in prison together. What REALLY sucked was there were NO discounts whatsoever. Had a lot less respect for the company after that. |
re: The Toys R Us thread (update: no longer DEAD)
I mean, what did you expect for a job at a retail store working in the back/merch? That's pretty much the backroom of every retail store.
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re: The Toys R Us thread (update: no longer DEAD)
I had just the opposite experience ... I worked there part-time over two Christmases. The first year I took the job I was really just looking for something to do (wife and I had separated for a period of time) and possibly a track on a new full-time gig down the road.
I worked the floor and I had a blast! I guess a good reason for that was not “needing” the job, so I was able to stay away from things I didn’t want to do. I focused almost solely on customer service on the floor and revamping/managing their messed up rain check system. I had customers bringing us food (for finding or getting that gift they couldn’t find anywhere), compliments going to corporate, training people they didn’t have time to train, etc. They loved me because they basically got a floor manager for minimum wage. Oh, and the hot moms ... oh, the hot moms. ;) I went back the next year just because I had so much fun. They had cut staffing hours that next year and had gotten a new store manager, so it wasn’t quite the same. I still had fun though because I could “dictate” my terms (i.e., not running a register). Our back room wasn’t quite that bad, but it wasn’t too far off. They were pretty fun guys though. If you were cool with them, they were cool with you. As for the state of things, TRU suffers from one of the things that did in Blockbuster and Hollywood ... their stores were too big. That was great when retail space was much, much cheaper per square foot. Eventually increasing rents, utilities, and even just plain maintenance costs pushed overhead costs out of balance with what they could sustain. They needed to reduce SKUs and increase special ordering, reduce their footprint (probably by half in most stores), and give themselves a facelift. Instead they doubled down on Babies R’ Us, increasing all the overhead problems. They also put too much emphasis on low-margin categories such as video games (they even looked at buying Game Crazy from Hollywood at one point). |
re: The Toys R Us thread (update: no longer DEAD)
Yep, I was hoping I'd be on the sales floor, but they stuck me in the back (called it "Pickup".) It was just a 2nd job, but not a great experience all around. I'd hoped that I'd at least be able to get a Sega Saturn at a discount, but of course that didn't happen- got one the next year at Incredible Universe (remember that?)
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re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by Abob Teff
(Post 13287478)
As for the state of things, TRU suffers from one of the things that did in Blockbuster and Hollywood ... their stores were too big. That was great when retail space was much, much cheaper per square foot. Eventually increasing rents, utilities, and even just plain maintenance costs pushed overhead costs out of balance with what they could sustain. They needed to reduce SKUs and increase special ordering, reduce their footprint (probably by half in most stores), and give themselves a facelift. Instead they doubled down on Babies R’ Us, increasing all the overhead problems. They also put too much emphasis on low-margin categories such as video games (they even looked at buying Game Crazy from Hollywood at one point).
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re: The Toys R Us thread (update: no longer DEAD)
I won't deny that the stores are too big, that target and Walmart and Amazon were eating into their space, etc., but my understanding is that the debt brought on them when they were bought by Bain is what did them in.
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re: The Toys R Us thread (update: no longer DEAD)
Yeah, TRU had problems foisted on it by Bain, but we're in a new reality where the retail landscape is changing for large specialty stores. Twenty or thirty years ago, you could have giant stores like B&N, Borders, and Virgin Megastores, but they've been eaten alive by physical online sales and digital distribution.
TRU doesn't face the same Kindle/iTunes digital competition media does, but they have to deal with distributors who won't put in-demand products in their hands. Good luck walking into a TRU and leaving with a NES Classic or short-packed Star Wars action figure. |
re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by fujishig
(Post 13287798)
I won't deny that the stores are too big, that target and Walmart and Amazon were eating into their space, etc., but my understanding is that the debt brought on them when they were bought by Bain is what did them in.
http://inthesetimes.com/article/2060...lled-toys-r-us How it got this bad Vornado Realty Trust, KKR and Bain Capital financed 80 percent of the purchase of Toys “R” Us, so while the company sold for $6.6 billion, the trio only contributed $1.3 billion. As part of the purchase agreement, the companies also agreed to take responsibility for all of Toys “R” Us’s long-term debt obligations, which at the time totaled $2.3 billion. Once Toys R Us was taken over, however, the debt Vornado Realty, KKR and Bain used to acquire it was pushed back onto the company, skyrocketing its debt obligations to $7.6 billion. Toys “R” Us has been paying $400 million a year to service these debts. This money could have been used to lower prices or improve the company’s website—not to mention raising pay to its employees—but instead went to paying off creditors. Last year, the company reported a loss of $29 million. If it weren’t for these debt payments, Toys “R” Us would have run a substantial profit. Vornado Realty, KKR and Bain tried to cash in by taking Toys “R” Us public from 2010 to 2013 but ultimately failed. Since then, Vornado has incrementally “written down” their investment in the toy company to zero, meaning they see their shares as essentially valueless. The pattern followed by Toys “R” Us is typical in private equity takeovers. Management is bought off: John Eyler, CEO of Toys “R” Us, was compensated $65.3 million upon the buyout’s completion. Employees have no say in the matter. Then come the layoffs, debt transfers and shortsighted asset sales. Funds are earmarked to pay down debts—Toys “R” Us was spending more annually on debt payments than it was on its website and stores—even as cash reserves are depleted. Before the buyout, Toys R Us had $2.2 billion in reserves. As of 2017, that number is down to $301 million. Just two months ago, Toys “R” Us was still trying to renegotiate its debt agreements with its creditors. But on September 6, CNBC reported that Toys “R” Us was flirting with bankruptcy—possibly just as a negotiation tactic—and investors panicked. Vendors started asking for cash payments for their services and, in some cases, that all accounts be paid off. Bond prices plummeted to 18 percent of their face value and upfront costs for debt insurance went up 2,500 percent. |
re: The Toys R Us thread (update: no longer DEAD)
Is this official, or just a rumor?
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re: The Toys R Us thread (update: no longer DEAD)
This is a post from Toys R Us Facebook page.
To our loyal customers, Toys“R”Us kids, parents, parents-to-be, and everyone in between: We’ve seen an amazing outpouring of love and support in recent days and want you to know that we truly appreciate it. Our stores are open for business, and ready to bring joy to children wherever we can, and to help new and expecting parents navigate the crazy world of raising a family. |
re: The Toys R Us thread (update: no longer DEAD)
That statement is not a denial.
It's just vague gibberish before they make the official announcement. |
re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by Josh-da-man
(Post 13288511)
That statement is not a denial.
It's just vague gibberish before they make the official announcement. |
re: The Toys R Us thread (update: no longer DEAD)
Originally Posted by DVD Josh
(Post 13288630)
I read it more as "please buy our stuff before we have to sell it to a liquidater at 10 cents on the dollar"
*all sales final. Did it break when you got home? Fuck off, call the manufacturer. |
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