From this angle: What Toys 'R Us' recent closures signal
Toys ‘R Us did something that had to be done. The beleaguered chain, now in bankruptcy protection and pretty much directionless, announced on Tuesday that it was shuttering about 180 stores across the country.
That should have caught no one by surprise and expect more closely in coming months and years as it tries to survive against more adept competitors, both digital and traditional.
But the real news here is that Toys ‘R Us officials have finally figured out that their decision nearly 30 years ago to create Babies ‘R Us was a short-term gain that resulted in a long-term loss. In the company’s glory days—also when everything from diapers to toys were sold under one roof—the company was able to get consumers into the store for their lower-margin baby needs and upsell them on higher-margin toys and games.
Creating two separate companies took away that advantage. Now, leadership is putting the two divisions back together—where possible—again, hoping to re-create the synergies between babies, older children and their moms.
A step in the right direction, but it may just be a decade or two too late. Time will tell if Toys ‘R Us will survive.
That should have caught no one by surprise and expect more closely in coming months and years as it tries to survive against more adept competitors, both digital and traditional.
But the real news here is that Toys ‘R Us officials have finally figured out that their decision nearly 30 years ago to create Babies ‘R Us was a short-term gain that resulted in a long-term loss. In the company’s glory days—also when everything from diapers to toys were sold under one roof—the company was able to get consumers into the store for their lower-margin baby needs and upsell them on higher-margin toys and games.
Creating two separate companies took away that advantage. Now, leadership is putting the two divisions back together—where possible—again, hoping to re-create the synergies between babies, older children and their moms.
A step in the right direction, but it may just be a decade or two too late. Time will tell if Toys ‘R Us will survive.