It is a sad day in history, and yet another piece of childhood nostalgia faces a grim future in the 21st Century. It may be a magical place with toys in their millions all under one roof, but after nearly 70 years of being a staple of the high street, Toys "R" Us has officially filed for bankruptcy in the USA and Canada.
The colorful toy emporium has done what was expected and filed for Chapter 11 bankruptcy, which will see the future of its 1,600 st0res and 65,000 employees hang in the balance. Thanks to a rise in online shopping and increasingly large outgoings, the shop has been forced to try and restructure over $5 billion in debt in hopes it can still keep its doors open. Apparently, the Toy and Babies "R" Us stores won't be affected, but underperforming stores will likely be shut for good.
NPR reports that the news was announced by Chairman and Chief Executive Officer Dave Brandon, who seemed optimistic about the company resolving the situation:
"Today marks the dawn of a new era at Toys "R" Us where we expect that the financial constraints that have held us back will be addressed in a lasting and effective way. As the holiday season ramps up, our physical and web stores are open for business, and our team members around the world look forward to continuing to put huge smiles on children's faces."
Toys "R" Us will remain open throughout the upcoming holiday season and will continue to honor all returns, gift cards, and loyalty schemes. While there will undoubtedly be liquidation sales, the toy giant hopes to live on in whatever capacity it can. The news is slightly better for Asia, Australia, and Europe, with stores there not being part of the bankruptcy proceedings and seeming to continue as normal.
There is a bitter sense of irony to the situation, with Toys "R" Us having previously squeezed out other toy stores like FAO Schwarz and Kay Bee Toys. Sadly, as the last major free-standing toy retailer, even Toys "R" Us can't compete with what has been a terrible year for retail. With more and more shoppers moving online - and a rise in one-day delivery from the likes of Amazon - even the biggest high street stores are struggling to compete with the craze of internet shopping.
Sadly, it sounds like the whole toy sector is in jeopardy right now, with Hasbro's stock falling by 1.7%, Mattel by 6.2%, and even LEGO laying off 1,400 staff amidst falling sales expectations. Here's hoping that Geoffrey the Giraffe can keep his long neck above water long enough to see Toys "R" Us through to the future.