5 Reasons Toys R Us Is Struggling

even this new Geoffrey design looks nervous and insecure

Toys R Us: this was a staple of my childhood. Even just their damn Christmas fliers were a staple of my childhood. The big place where the magic happens: the joy factory. Were there ever sweeter words to a child’s ears than a parent telling them they are going to Toys R Us?

And now Toys R Us looks like it might be going tits up. Or rather: up to 182 stores—20% of its U.S. fleet—might close, as part of its Chapter 11 bankruptcy plan. Why has this once hallowed institution of fun fallen on hard times?

5. “Big Box” Stores In General Are Failing: This is an epidemic, folks: watch a YouTube channel like Retail Archaeology to get yourself informed. The “specialty” Big Boxes like Toys R Us and Sports Authority are doing particularly terrible—but even a powerhouse like Walmart is not entirely out of the woods yet. And this is because…

4. Everybody’s Buying Stuff On The Internet: I mean…obviously. Especially from the mega-shopping sites like Amazon, which makes shopping as easy as a click or just audio commands. Even big toy companies like Mattel have set up a shop on the other big place to buy toys online, eBay. How can a Big Box store—much less a small business—compete?

3. The Price Of Plastic Continues To Rise. Here’s a factor you might not have thought of…but it absolutely makes a difference in terms of the affordability of toys. The price of making plastic—which depends on the price of oil—keeps going up. This has literally resulted in higher prices for things like action figures—ten years ago, a regular 6-8 inch figure would go anywhere from $10-12. Now they often start at $20, with the more affordable ones made much smaller. Who can afford $20, $25 action figures??? ADULTS!

2. Adults Increasingly Buy Most Of The Toys. If you look at the Barbie market, for instance…that’s largely adults. Only the youngest children want to play with Barbies anymore, with the rest being adults purchasing them for nostalgia. And then these same adult collectors will go to stores like Toys R Us and buy up all the “cool” figures and dolls and robots, convincing toy companies to make more expensive versions specifically for that aging demographic…toys that then children have less and less interest in. But even the adults no longer need to cope with a Toys R Us running out of that rare item, when they can go to Amazon, eBay, etc. So it has been this cycle that’s been going on for a good 20 years at least, leading to what we have now.

1. Children Don’t Play With Toys Anymore: Or, rather, they tend nowadays to play computer-based games. And we’re increasingly talking about games on iPads and stuff like that—without even any cartridges or other peripheries that can be theoretically sold in the Toys R Us. I have a young niece and nephew, and I remember the year where they both largely turned their backs on dolls and trains and became glued to their iPad. And when kids do get “tactile” toys nowadays, they also tend to be “educational”…because we gotta prepare them for that tough AI-based economy out there! I bought my niece and nephew all educational toys last Christmas—purchased through Amazon, of course. Am I part of the “problem” on multiple levels? Probably…I’m also an adult toy collector!

So as you can see, it is just this big eco-system of economic dysfunction for the Big Box Toy Chain…and I think Toys R Us is one of the few ones left. Remember KB Toys? Lionel Kiddie City? F.A.O. Schwarz? I do! And they are all gone…gone…