Toys “R” Us has filed for bankruptcy protection in the US and Canada.
In the US they call it Chapter 11, which protects the business from creditors and allows the respective business to reorganise and pay its debts over a longer period of time.
Toys “R” Us was the largest toy shop in the US, but has come under pressure from online shopping platforms such as Amazon, Target and Wal-Mart.
The debts of Toys “R” Us has amassed to £3.5bn ($5bn) and they have to pay a whopping £296m ($400m) in interest payments next year.
The British part of the business is unaffected, with a total of 110 stores with 2,500 employees.
Toy “R” Us has 600 international stores and 140 licensed stores in 35 countries.
Toy “R” Us started life as Children’s Bargain Town, specialising in baby furniture in 1948, by Charles Lazarus during the post-war baby boom.
As Children’s Bargain Town took-off customers asked about buying toys, which as any businessperson knows ‘give the customer what they want.’
In 1957 the store was renamed Toys “R” Us.
In 1966 Interstate Department Stores bought Toys “R” Us.
Interstate Department Stores went into bankruptcy in 1974, and Charles Lazarus was appointed to run Interstate Stores.
By 1978 Toy “R” Us was the most profitable businesses to come out of the Interstate Stores bankruptcy, which now stood on its own two feet, and went public in 1978.
By the early 1980s Toys “R” Us started to expand its range into children’s clothing calling its two new stores in New Jersey and New York as Kids “R” Us, but closed its standalone stores in 2003. Babies “R” Us started in 1996 and currently has 260 stores in the U.S.