Without Toys ‘R’ Us, 30K jobs, ripples will be felt
The demise of Toys “R” Us will have a ripple effect on everything from toy makers to consumers to landlords.
The 70-year-old retailer sought court approval Thursday to liquidate its remaining 735 stores, eliminating the jobs of some 30,000 employees while spelling the end for a chain known to generations of children and parents for its sprawling stores and Geoffrey the giraffe mascot.
The closing of the company’s U.S. stores over the coming months will finalize the downfall of the chain that succumbed to heavy debt and relentless trends that undercut its business, from online shopping to mobile games.
And it will force toy makers and landlords who depended on the chain to scramble for alternatives.
CEO David Brandon told employees Wednesday the company’s plan is to liquidate all of its U.S. stores, according to an audio recording of the meeting obtained by The Associated Press.
There is still some hope. Toys “R” Us will try to bundle its Canadian business, with about 200 U.S. stores, and find a buyer. The company’s U.S. online store would still be running for the next couple of weeks in case there’s a buyer for it. Workers in the U.S. will get paid for the next 60 days if they show up for work, but after that all benefits and pay will be cut, Brandon told employees at the meeting, according to the recording. Some workers will be asked to stay longer to help with the liquidation.
The company said gift cards will be honored for the next 30 days. It will not accept returns once the liquidation sales start.
It’s likely to also liquidate its businesses in Australia, France, Poland, Portugal and Spain. It’s already shuttering its business in the United Kingdom.