Toys"R"Us, Seeking Stability, May Close 200 More Stores
Toys"R"Us may close up to 200 more stores as it tries to stay afloat and away from a path of bankruptcy. The New York Times reports one plan Toys"R"Us is considering includes shuttering 200 stores, and possibly more, as it tries to recover from a prolonged sales slump, including a dismal holiday season. While the planning is fluid and far from completion, the possible store closings, which were reported earlier by The Wall Street Journal, reflect the serious challenges that Toys“R”Us faces. Recently the toy retailer already took steps to try and stabilize the business, including shutting down 182 locations nationwide.
Total Retail's Take: Toys"R"Us is being uber-agressive in cutting costs as it tries to deal with mounting debt and slumping sales. While many retailers had a strong holiday season, Toys"R"Us faltered, citing “operational missteps” for its poor performance. In addition to the timing of last year's bankruptcy filing, mere months before the hectic holiday season, and fierce competition from Amazon.com and other big-box retailers, Toys"R"Us has struggled instilling consumer confidence. Potential changes to the retailer, including less stores and those that remain shrinking in size, as well as a focus on customer experiences and not just product, would figure to help Toys"R"Us survive. However, after a sales tumble like this and Amazon beefing up its toy inventory, Toys"R"Us will need to make changes quickly.