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Thread: ToysRUs UK & US bankruptcy & closure

  1. #71
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    Quote Originally Posted by Ralph Wiggum View Post
    If Toys R Us is financially wrecked because people weren’t bonking enough and walking through the doors then clearly their business model was outdated.
    ^ 100% correct.

    It is simply not the case and hence my tongue in cheek fun poking at that article above.

    I don't think the Aussie stores will slump any time soon. As Griffin points out, it will come down to how they remove the US shareholdings and transfer of rights. I know every time I walk into my local TRU they are packed and I always have to line up to buy anything so their sales must be doing ok at the least.

  2. #72
    bowspearer Guest

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    Quote Originally Posted by Polursine View Post
    So, TRU Kotara (one of like 3 in the Hunter/Newcastle Region) has been undergoing major renovations (along with Kmart and JBHifi) at a local shopping center, with plans to reopen in late 2018. Will be interesting to see how this affects their plans. Maybe a candle lit vigil in the near future?
    I wouldn't be surprised if it were with a KB Toys sign on the front of them.

    Quote Originally Posted by griffin View Post
    The UK and US ToysRUs companies failed due to issues that were not related to sales (so demographic changes are moot points).
    The US company collapsed due to the people who bought the company, not doing their homework and over-valuing the it, so borrowed more than they could pay back in a short period of time. The sales were actually improving over the last couple of years, with them actually making a profit last year... and then they made the stupid decision to file for bankruptcy last year thinking that it could help increase their Christmas sales if they could delay paying bills until afterwards.
    That started a whole legal process that included the possibility of liquidating the company, which they didn't think would happen... or were too arrogant to think that it could happen.
    They were still in a very stable financial position, adapting to the changing retail environment (and customer demographic) enough too be able to have steady increases in their sales in recent quarters and make profit last year... but that over-valuation purchase debt was something that was working against them. They were paying it off, but it was still a burden, and not something that they would be shaking any time soon.
    I agree that all of that accelerated the process; Dick Smith is an example of the exact same thing here. The problem I see is that the megastore model can't survive a significant drop in its customer base in the way smaller stores are (in fact smaller stores which can withstand a megastore are more likely to be in a better place in the very environment that is the death knell of the megastore).

    Quote Originally Posted by griffin View Post
    Meanwhile, the UK operation was burdened by a different debt, relating to their leasing costs blowing out as the land values outpaced their sales rates.
    That also could be said to be part of a similar issue. A smaller store, in the shrinking demographic, wouldn't have been as affected by it as a megastore and could well have weathered it far better..

    Quote Originally Posted by griffin View Post
    Demographic changes are real, and a challenge for all retailers who have to market to whatever the current trends or demographics are, but ToysRUs (particularly with their BabiesRUs branch that kept them afloat last time they went through a bad run), had adapted, and none of the various global branches were suffering from significant sales slumps or even downturn at all.
    Essentially what they did though in many cases, was halve the megastore and put half another store in the same real estate which focused on essentials

    And I think that the talk about selling off Asian, European or Australian operations is because the US company has a stake in them, and if that company is being liquidated, their stake (partial or whole), has to be sold off to repay their debts. It just depends on who gets the naming rights in those countries... if they are sold with the stores and assets.
    It would be like Mcdonalds collapsing in America - the Australian operation would still continue if it is profitable, but the American company would sell its stake to a new business or investor... who would want to have the name with the purchase, as much of the value of the company comes from the brand recognition.[/QUOTE]

    I'm going to put this out there now - I wouldn't be surprised if by the end of the year, most of those stores get rebranded as KB Toys.

    Quote Originally Posted by Ralph Wiggum View Post
    If Toys R Us is financially wrecked because people weren’t bonking enough and walking through the doors then clearly their business model was outdated.
    It's arguably been outdated for over a decade, but megastores aren't the easiest things to scale down.

    Quote Originally Posted by Raider View Post
    I know every time I walk into my local TRU they are packed and I always have to line up to buy anything so their sales must be doing ok at the least.
    That depends on the store. I was in Frankston at the start of the year wandering around their store on a Friday night. While the shopping centre itself was packed, the TRU there was deserted and the shelves were poorly stocked. Likewise, I don't think I've ever seen TRU Belconnen packed on a Friday night, but the same can't be said for the Zing right next to it - which always seems to be packed with people. While certainly some stores will be doing well, clearly not all of them are.

  3. #73
    FatalityPitt Guest

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    There's a gofundme campaign in attempt to save Toys'r'us.

    https://www.gofundme.com/helpsavetoysrus

    Found out via Seibertron (https://www.seibertron.com/transform...toysrus/40941/)

    My thoughts - they should just do away with the car bumper stickers and prizes. The money to produce those bumper stickers should go towards raising the $1 billion they're trying to raise. But then again, I suppose driving around with it would help spread awareness.

    Also, they're now on about $200 million.

  4. #74
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    I just can't see too many people donating to this, even if there were rewards... because it would be like being asked to help bail out a bank - these are big soulless corporations, and if the $800million is raised, the new owner would have only paid $200million for the billion dollar business.
    (and I'm not sure how the American anti-competition laws work over there, but if this was here, it wouldn't be allowed by the government because it could lead to the toy-company owner of TRU blocking or pricing out its rivals, to better feature its own toys - think what it would be like if Pepsi bought out Coles... Coles would either stop stocking Coke products, or price them to make them unattractive to customers, leading to Coke losing almost half of its sales due to that one retailer no longer giving them fair access)

  5. #75
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    I really don't like news sites actively pushing crowdfunding. Rebelscum has been pushing the Hasbro Jabba's Sail Barge, which frankly I think Hasbro shouldn't be crowdfunding anything as they are a profitable company. Now Seibertron is pushing this stupid attempt to save TRU.

    And isn't Gofundme one of those crowdfunding platforms that charges you regardless of if the goal is reached???

  6. #76
    bowspearer Guest

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    Quote Originally Posted by DELTAprime View Post
    I think Hasbro shouldn't be crowdfunding anything as they are a profitable company.
    Having just gotten an email about it from Hasbro and having seen the thing, I completely disagree with you. They're not crowd-funding at all - they're doing a preorder-based production run on this so that they can justify production costs. In fact they explicitly state they're not taking money for it unless the 5,000 order target is reached.

    The fact is that given how difficult it can be for Hasbro to avoid big Star Wars vehicles being shelfwarmers (6 inch Black Series Tie Fighter anyone), I think it's entirely valid for Hasbro to take this approach - especially as most retailers will take one look at it and immediately envisage stock they're stuck with unless they take a massive hit on it. That's not even ignoring the fact that with the exception of the USS Flagg, I can't think of a single playset Hasbro has produced that is less space friendly than this behemoth.

    At 1.25m long and 43cm high, with a cost of $499, there is no way Hasbro could reasonably be expected to take a gamble on this at retail - especially in today's toy market. As such, the concept of turning to fans and saying "Hey, we want to give you guys this, but to be able to make this a reality at $x, we need y numbers of guaranteed sales. Who's interested?" is entirely reasonable.

  7. #77
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    The liquidation sales in the US have begun at many of the stores today (Friday the 23rd over there at the moment), with discount, conditions and exclusions signs posted up at stores.

  8. #78
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    Went into my closet Japanese store amd it looked loke business as usual. No lack of customers or prices down there. A few newly released transformers on the shelf as well.

  9. #79
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    Quote Originally Posted by bowspearer View Post
    Having just gotten an email about it from Hasbro and having seen the thing, I completely disagree with you. They're not crowd-funding at all - they're doing a preorder-based production run on this so that they can justify production costs. In fact they explicitly state they're not taking money for it unless the 5,000 order target is reached.

    .....

    At 1.25m long and 43cm high, with a cost of $499, there is no way Hasbro could reasonably be expected to take a gamble on this at retail - especially in today's toy market. As such, the concept of turning to fans and saying "Hey, we want to give you guys this, but to be able to make this a reality at $x, we need y numbers of guaranteed sales. Who's interested?" is entirely reasonable.
    I agree entirely, and I am hoping it will prompt interest in playsets again. Can you imagine how cool it would be to have an Ark playset, or Shockwave's lab, or hyperspace bridge. Even just an official Teletran-1, instead of 3rd party releases.

    But they only seem to be offering to US/Canada, or I might have put down money on it. I hope this is fixed when/if they do crowdfunding for other properties
    On the lookout for MISB Headmaster Highbrow, Takara or Hasbro. I'm sure I could make you a sweet deal!

  10. #80
    bowspearer Guest

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    Quote Originally Posted by reillyd View Post
    But they only seem to be offering to US/Canada, or I might have put down money on it. I hope this is fixed when/if they do crowdfunding for other properties
    While in theory it would be great owning this outside of the US, I can understand why they did it. The sheer size of the thing makes shipping overseas by anything other than courier an impossibility. I suspect that given that this is an entirely new approach by Hasbro, they might want to get any bugs out of this run, before they throw international couriers into the mix.

    The other possibility is that they might have thought, being clearly tentative here, that not enough people from overseas would be willing to fork out the courier fees to offer it.

    I think one of the best things that international Star Wars fans who would have bought this can do, is complain en masse. If Hasbro sees that fans are that keen to pay courier fees, that they're angry they didn't get the option of opting in and in large enough numbers, I can't see Hasbro not playing ball. After all, there should be no conflicts with there other markets here like there are with HTS.

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