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Toys R Us Closes its Stores

Toys R Us closes its last 200 stores in the United States, Friday, June 29, 2018.  It was a very sad story for the company and also all the employees who suddenly found themselves without a job.  It seems that toys are not that of a commodity in the US nowadays but remains to be in other parts of the world including the Philippines.

Why did Toys R Us close in the US?

Toys R Us filed for bankruptcy in the United States, September 18, 2017 as well as in Canada.  Later in 2018 it was announced that the U.S. operations of Toys "R" Us were, after 70 years, going out of business and selling all 735 locations in the U.S.

The UK stores closed on April 24th and US stores closed for good on June 29th, 2018 after over 70 years. On June 20, It was announced that all of their Australian stores will be closing as well

The main culprits:
  • $5 billion in long-term debt
  • Lack of saleability of toys due to new developments probably to gaming (just our hunch though)

Will Toys R Us Philippines Follow?

What will happen to Toys R Us Philippines?  Will it eventually close as well?

The local store is under the management of Robinsons and we do not know how profitable this section is yet.  All we know is that all the Asia locations are not part of the US process.

Toys"R"Us Asia Limited is headquartered in Hong Kong and is in a J.V. with Fung Retailing Limited (a privately-held entity and member of the Fung Group). This means that it has a license with the main company and might be still profitable.  In any event, they can just buy out the brand and continue operation.

Do you think Toys R Us in the Philippines and Asia will continue?  Share us your views.

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