Today, all 700+ Toys R Us stores in the United States were supposed to begin their liquidation sales. However, it looks like Friday, March 23rd, is the new date for liquidation sales to begin. This change could be due to a number of reasons, but I bet it has something to do with the most recent news that MGA Entertainment CEO Isaac Larian has announced his plans to purchase some of the Toys R Us stores and essentially keep the brand alive. It’s important to note that Larian is using his own money, not MGA Entertainments. (He’s just that rich!) MGA Entertianment is known for Bratz and the current trend, LOL Surprise dolls.
Larian, along with unnamed investors, have $200 million dollars on the table and are currently crowd funding to reach $1 Billion dollars. As this isn’t a charity donation, those who donate specific dollar amounts get fun incentives, assuming Larian reaches the $1 Billion dollar goal by May 28th, 2018. Some of the incentives are special edition Num-Nums, L.O.L Surprise, Little Tikes products, a factory tour and finally, for donations of $50,000.00 or more a block party, theme park stays, 5 years worth of toys from Toys R Us and more! Of course, there’s also smaller incentives, like shirts, bumper stickers, etc. Donating won’t make you a partner in the new Toys R Us brand, but is a way for dedicated shoppers to help keep the brand alive.
I, personally, am not 100% sure that crowd funding for this sort of cause is right, per say, but, I’d be lying if I wasn’t thinking about tossing in $5.00 to the campaign.
Why is Larian so interested in keeping Toys R Us alive? According to Larian, nearly 1 in every 5 sales of MGA Entertainment products is purchased at a Toys R Us store. Not to mention, Toys R Us is known for their variety of toys. Newer or smaller toy makers will have a much tougher time finding a physical store to carry their stock once Toys R Us is gone, which could mean even more jobs lost. (Think about the number of toy aisles in a Target or a Walmart vs a Toys R Us. These other big box stores just don’t have the space to ‘test’ out new toys just hitting the market.) Larger companies, like MGA Entertainment, Mattel or Hasbro, are not immune to the possibility of lay offs if Toys R Us leaves the retail market, either.
To read the court documents, many of which are from toy makers looking to get their stock back before liquidation begins, go here. For me, I’m keeping an eye on all the liquidation news and probably hitting up my local store a lot more often within the next few weeks. Toys R Us stores, for the most part, stopped receiving new stock two weeks ago and have an estimated closure date of early May 2018.
My advice to you is this: First, use up those giftcards now. Second, if you see something you like, grab it. Don’t wait until ‘next time’, because there may not be a ‘next time’. And most importantly, please be nice to all the employees. It’s not their fault that the toy you wanted is out of stock. It’s not their fault that the only toy store in 50 miles is closing. It’s not their fault that the lines wrap around the stores. Remember, the faithful employees you interact with while shopping at your liquidating Toys R Us are people who are losing their jobs– their livelihood. They’re not getting bonuses or severance checks. So, be nice to them. Because, in the grand scheme of things, you not finding the toy you wanted or standing in line longer than you might usually is way less agonizing than the stress, loss and emotional struggles the hard working Toys R Us crew at your local store will be going through once Toys R Us finally closes and they lose (possibly) their only means of survival.
Now, onto part two of this post– KayBee Toys (or KB Toys) may be making a return to retail! For those who don’t know, KB Toys was a mall staple from 1922 to 2009. Smaller than Toys R Us, it is still held in fond regard by those who walked around its aisles. Before it liquidated, KB Toys was the 2nd oldest operating toy retailer in North America (behind FAO Schwarz). Sadly, KB Toys fell victim to the same management problems as Toys R Us, when Bain Capital, the current owner of Toys R Us, saddled the mall toy store with a large amount of debt after acquiring the brand for $302 million, largely borrowed from creditors, in 2000. (This is exactly the same thing they did with Toys R Us.) This article talks a bit about the questionable management of Bain during the time it owned and liquidated KB Toys. The article is politically charged, but has some interesting information.
According to another article, “After buying KB Toys in 2000, Bain and its co-investors had the retailer borrow $85 million to pay the firm and its co-investors a dividend — a move that left the chain, which had been generating steady earnings, strapped for cash as deepening price cuts at Walmart lured more shoppers away from malls.” This lead the company to liquidating in 2009.
In 2017, a company called Strategic Marks, LLC acquired the KB Toys brand. They’ve been working on a plan to bring back the “Great American Toy Store”. With Toys R Us liquidating, their current goal is to support the toy companies by opening pop up shops set up under the KB Toys umbrella for the 2018 holiday season. Obviously, Strategic Marks is still developing their plan, but it seems like they’re on the right track.
In messages posted to LinkedIn by Ellia Kassoff, Founder of Strategic Marks, he says, “We’re in discussions with many of the toy manufactures, as we try to find out the best way to support them and the 20% loss of the US toy market due to the Toys R Us liquidation. We believe we will have the infrastructure in-place and [hopefully] save the toy industry.” In another post, he said, “Our umbrella, Strategic Marks, LLC has been very successful bringing back many of the most popular products and companies over the last ten years because we follow a very strict formula; [To bring back the experiences we loved as a child, just as you remembered them].” You can ‘follow Ellia on LinkedIn, where he seems to be posting short updates on the KB Toys re-launch.
So, that’s about it on Toys R Us and KB Toys– for now. News seems to be changing every day. I try to share news on my Facebook page, so subscribe to that for more news on this topic. What are your thoughts on KB coming back? Toys R Us’s possible return? Do you have found memories of either store? Share them in the comment area!
UPDATE: TMZ is reporting that the founder of Toys R Us, Charles Lazarus, passed away today at the age of 94.
Advertisements &b; &b;March 22, 2018. Tags: Article/How to. Uncategorized.
