Toys 'R' Us could go out of business next week.

[Apologetic_Warrior]

Bankrupt retailer Toys "R" Us may shut all its US stores as soon as next week, according to several reports.

That's terrible news for the two biggest publicly traded toy companies. Investors are clearly preparing for the worst. Shares of Hasbro (HAS) fell 3.5% Friday morning while Mattel (MAT)plunged 7%.

Smaller toy company Jakks Pacific (JAKK) fell nearly 5% too. Canada's Spin Master, which owns the popular line of Hatchimals toys, was down about 3% as well on the Toronto Stock Exchange.

And everything isn't awesome for privately held European toy giant Lego either. The plastic bricks maker reported its first sales drop in thirteen years earlier this week. So these are clearly tough times for the toy makers.

A spokesperson for Toys "R" Us declined to comment on the liquidation chatter.

Toys "R" Us recently went into administration in the UK, paving the path for stores there to shut their doors. And the potential closing of Toys "R" Us in America would be a particularly huge blow to Hasbro and Mattel.

According to recent regulatory filings from both companies, Toys "R" Us accounted for nearly 10% of the companies' overall sales.

Toys "R" Us is the last megastore dedicated to toys. Without it, toymakers will struggle to promote anything but their most popular items.

Any theories as to how this could happen to the giant of toy retailers? Are we spending more on electronic gadgets and cheap knockoff toys from China than on brands like Hasbro and Mattel? Personally the news is a bit shocking, and I have always been kind of a fan of Hasbro toy lines such as G.I. Joe and Transformers, and I am thinking the Star Wars toy lines in America came from Mattel.

 

[royal priest]

I guess everybody grew up?

 

[Apologetic_Warrior]

I guess everybody grew up?

LOL I don't wanna grow up I'm a "Toys r Us kid" at heart, my five year old son knows this.

 

[Babe Ruth]

Any theories as to how this could happen to the giant of toy retailers? Are we spending more on electronic gadgets and cheap knockoff toys from China..

Warrior, I'm really interested in the retail game. I've been following this Toys story.

My opinion, their demise has a couple contributing factors.. primarily the rise of online ordering. Also large dept stores gradually taking toy shopping from specialized retailers like Toys.
Used to be, Toys was competing with sporadic, regional dept stores.. but as supersized national dept stores like Wal*Mart (who can buy in bulk, & sell inexpensive) moved in to every market & displaced regional dept stores, shoppers started turning to them for their toy shopping.
The current retail model seems to be shop from home. Or if that fails, go one-stop shopping @ Wal*Mart.
Specialized retailers are (unfortunately) in serious trouble. My opinion/observations.

 

[Tree of Life]

Any theories as to how this could happen to the giant of toy retailers? Are we spending more on electronic gadgets and cheap knockoff toys from China than on brands like Hasbro and Mattel? Personally the news is a bit shocking, and I have always been kind of a fan of Hasbro toy lines such as G.I. Joe and Transformers, and I am thinking the Star Wars toy lines in America came from Mattel.

Amazon.

 

[blackribbon]

Simple answer... Amazon. Even people who do walk into the doors of many of these retail stores, go home and shop for a better price online.

 

[Multifavs]

Hm, I rarely shop on Amazon myself because the prices I see usually seem to be quite high and it always seems to be hard to find what I want.

 

[Apologetic_Warrior]

Simple answer... Amazon. Even people who do walk into the doors of many of these retail stores, go home and shop for a better price online.

Is Toys R' Us still partnered with Amazon? I don't understand the drops for Hasbro and Mattel, online retailers such as Amazon carry their toy lines, investors are strange.

 

[PloverWing]

I suspect Babe Ruth is right. When I think about my last few toy purchases, they were online from Amazon. If you know what you want in advance, and you don't need to pick up and handle the thing you're buying, then it's easier to click a button from your living room than to drive 20 minutes to the nearest Toys R Us. I don't like seeing the bricks & mortar stores closing, and I didn't mean to help close them down, but if enough people choose online shopping, then that's hard for the physical stores. I've seen a lot of physical bookstores closing, too, which is sad.

 

[MoneyGuy]

I guess everybody grew up?

Most of those grownups have kids, so your theory is flawed.

 

[Multifavs]

It is sad to see so many physical stores closing. Online shopping is easier and (often) quicker and you get more of a variety. I know that certain products are better to look at in person before you decide to buy them, and you get the item right away instead of waiting for it to arrive. Plus, you get exercise walking around the store. I guess both of them have good and bad points.

 

[blackribbon]

Is Toys R' Us still partnered with Amazon? I don't understand the drops for Hasbro and Mattel, online retailers such as Amazon carry their toy lines, investors are strange.

I suspect that Mattel and Hasbro aren't making toys that the kids want.

 

[Babe Ruth]

It is sad to see so many physical stores closing..

Multi, Agreed..
Sadly, I guess the halcyon 80s mall culture is basically extinct.
On principle, I keep trying to support traditional, physical retailers.. even tho it can be more expensive, & less convenient.
Only speaking for my area.. I'm noticing, as more families are abandoning walking around & shopping @ the mall.. left remaining is a culture of scary creeps & thugs loitering around. I guess they didn't get the memo, everyone (except for me & them), is shopping online now.
One of the local malls banned minors (@ night), because they were bothering & assaulting paying patrons.. peace

 

[pgp_protector]

My issue with them is they're overpriced. I can buy the same product at Target,WalMart,BestBuy,or Amazon for an Average of 10% less than Toys-R-Us

 

[Apologetic_Warrior]

I suspect that Mattel and Hasbro aren't making toys that the kids want.

I don't know the supply/demand ratios but both companies have lines linked to big box office hits. As far as I can tell, brands like Star Wars are going stronger than in previous years, and appears to be no end. But there is a great deal of competition in toy lines, and parents with limited funds have to help make choices accordingly.

 

[blackribbon]

I don't know the supply/demand ratios but both companies have lines linked to big box office hits. As far as I can tell, brands like Star Wars are going stronger than in previous years, and appears to be no end. But there is a great deal of competition in toy lines, and parents with limited funds have to help make choices accordingly.

Kids are wanting and getting more electronics than plastic toys.

 

[thecolorsblend]

A lot of it comes down to debt.

 

[Apologetic_Warrior]

Kids are wanting and getting more electronics than plastic toys.

Could be, is strange to me though, cell phones and tablets for toddlers and pre-K's...not in my home.

 

[Babe Ruth]

Kids are wanting and getting more electronics than plastic toys.

True.. but Toys R Us sells video games & electronic toys, etc. I've bought Nintendo gear for my family there.
I think the issue is convenience. It's cheaper for consumers to buy online & save on gas..

And along the lines of convenience, people would rather go to Wal*Mart & buy toys.. and simultaneously pick up their Twinkies and 5 gallon bags of pork rinds.

 

[Handmaid for Jesus]

Any theories as to how this could happen to the giant of toy retailers? Are we spending more on electronic gadgets and cheap knockoff toys from China than on brands like Hasbro and Mattel? Personally the news is a bit shocking, and I have always been kind of a fan of Hasbro toy lines such as G.I. Joe and Transformers, and I am thinking the Star Wars toy lines in America came from Mattel.

I use to shop Toys when my kids were small. I never thought they would go out of business.

I guess everybody grew up?

Well, mine did. LOL!

Warrior, I'm really interested in the retail game. I've been following this Toys story.

My opinion, their demise has a couple contributing factors.. primarily the rise of online ordering. Also large dept stores gradually taking toy shopping from specialized retailers like Toys.
Used to be, Toys was competing with sporadic, regional dept stores.. but as supersized national dept stores like Wal*Mart (who can buy in bulk, & sell inexpensive) moved in to every market & displaced regional dept stores, shoppers started turning to them for their toy shopping.
The current retail model seems to be shop from home. Or if that fails, go one-stop shopping @ Wal*Mart.
Specialized retailers are (unfortunately) in serious trouble. My opinion/observations.

I believe this.

Amazon.

Yep! This too.

Simple answer... Amazon. Even people who do walk into the doors of many of these retail stores, go home and shop for a better price online.

People are doing a lot of shopping online these days. It seems the shop til you drop era has passed. I remember when my daughter and I would leave home to go shopping early on Saturday morning. It would be Saturday night when we returned. Those were the good ole days. Maybe Toys did not see the changing trends and the did not change with the times.

Hm, I rarely shop on Amazon myself because the prices I see usually seem to be quite high and it always seems to be hard to find what I want.

They want too much personal information imho.