Toys “R” Us closed all of its stores after filing for bankruptcy in 2018. The iconic toy store brand ultimately failed as a business after taking on a substantial amount of debt during a buyout that took the company private.
Now the Toys “R” Us brand is making a comeback through a partnership with Macy’s (M). Toy stores ranging in size will open inside existing Macy’s over the coming months, offering unique experiences such as photo opps with a life-sized Geoffrey the giraffe and toy demonstration tables.
Failure to Relaunch
Since Toys “R” Us first shuttered its doors several years ago, several unsuccessful comeback attempts have been made. The Macy’s partnership came to be after WHP Global bought the Toys “R” Us brand from Tru Kids Inc., which originally acquired it in a liquidation sale. Tru Kids Inc. had opened some stores in Texas and New Jersey, but they were closed in early 2021 amid the pandemic.
Macy’s agreed to sell Toys “R” Us products on its website just under a year ago, which was around the time when ToysRUs.com also started selling items. Macy’s also opened 400 “shops-within-shops” at its US department stores.
Competitive Toy Market
The Toys “R” Us partnership has benefited Macy’s. Within its first-quarter earnings report, Macy’s said its toy sales were 15% higher than the comparable period, dating back to before the Toys “R” Us deal.
It’s been a relatively strong 2022 for Macy’s, which has outperformed its competitors, such as big-box retailers Target (TGT) and Walmart (WMT). For many American families, going to Toys “R” Us was a rite of passage around the holidays. Macy’s hopes that tradition can continue — within its own doors.
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