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Toys ‘R’ Us Didn’t Have to Die

bloomberg.com

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Re: Toys ‘R’ Us Didn’t Have to Die

#101

Post by code_duck »

aviv wrote: post #11
thisisit wrote: post #8

Retailing seems to be dying in US irrespective of the company: https://www.bloomberg.com/news/articles/2018-04-17/retail-st... Couple of years ago, one of my friends bought a store at a strip mall. The store was making a loss. And the previously owners were an elderly couple. So my friends thesis was that they weren't exactly tuned into the digital presence business and it was still entirely possible to run a store i…

In a few years strip malls will be occupied only by food businesses, pharmacies, check cashing places, and urgent care clinics.

Don't forget vape stores, liquor stores and Smoke Shop.

Re: Toys ‘R’ Us Didn’t Have to Die

#102

Post by arkitaip »

toufique wrote: post #98

Begs the question, what kinds of local businesses are structurally safe from being disrupted by Amazon? Some that come to mind: * Food - restaurants, fast food, pizza, takeout * Social experiences - bars, cafes, arcades, comedy clubs * Things that can't be shipped - gas stations, perishables * Things you want right away - milk, delis, convenience stores * Things that can't be commoditized - Copying keys * Services -…

Every single one of those industries can be disrupted by Amazon given the right setup with partners.

Re: Toys ‘R’ Us Didn’t Have to Die

#103

Post by majewsky »

ccozan wrote: post #49
bobthepanda wrote: post #32

Earlier quoted context omitted.

The US in general is heavily over-retailed. > By one measure of consumerist plentitude—shopping center “gross leasable area”—the U.S. has 40 percent more shopping space per capita than Canada, five times more the the U.K., and 10 times more than Germany. https://www.theatlantic.com/business/archive/2017/04/retail-...

Ok, that explains the US situation. Of my local situation, probably the explanation is because on a 30km radius there are not really any other shopping malls ( space being filled with cows on green pastures :) ).

It's not just your town. I live in Dresden, which already has one of the highest "shop space per capita" values in Germany, and while they've stopped opening new malls in the city (out of sheer lack of space), every new building adds more shop space. In some places, it takes just 5 minutes to walk from one Rewe branch to the next one.

(Context: Rewe is a German supermarket chain. There are about 5 nation-wide supermarket chains and 5 nation-wide discounter chains.)

Re: Toys ‘R’ Us Didn’t Have to Die

#104

Post by orwin »

amelius wrote: post #93
jwlato wrote: post #50

Earlier quoted context omitted.

You're missing the key piece: Toys R Us didn't go into debt for any good business reason, it was bought by a private equity firm and loaded with debt it didn't need. This is how private equity works: 1. A PE firm uses a combination of other people's money (limited partners a.k.a investors) and debt to buy a company. 2. The PE transfers the debt to the company's books. This way, if the company goes bankrupt the PE fun…

Why is this legal?

Free market and all this stuff.

Also a similar "technique" (LBO to be exact) was used to break down a giant company into smaller companies, effectively shutting down monopolies at the expense of a small number of workers, often making big gain for investors. With the failure of RBR Nabisco LBO, investors think twice about this kind of venture nowaday. If Toys'R US failure could cost the investors a bulk of money, maybe this won't happen anymore with big business like this.

Anyway, if you take part of venture like this, you better be the law firm or the executives, especially if your target is a big company.

Re: Toys ‘R’ Us Didn’t Have to Die

#106

Post by jinglebells »

yourapostasy wrote: post #45
jaysonelliot wrote: post #10

Earlier quoted context omitted.

There's nothing about the brick & mortar toy space that's inherently living on borrowed time. It was Toys 'R' Us' own mismanagement that doomed it. Toy stores can be a destination. Provide a compelling experience for parents and kids alike. It's easy to imagine a space where kids get to play with toys hands-on, and parents get to judge for themselves whether they think they're appropriate in terms of fun and quality—…

IKEA's physical presence only works because they are sole and best-priced supplier of what they offer. Don't build a retail business on the premise that people will want what they handle in the store right now instead of saving a few bucks ordering it online from elsewhere. The underlying price of the real estate to the revenue brought in by a toys-based sales funnel simply makes these locations untenable to flog pro…

Good point. I've got two young kids, they're not particularly over-toyed but over the years the collection has grown. My wife got fed up with the toys not being put away so she put all the toys in the attic.

The kids now play with the boxes, turns out they didn't even need the toys.

Re: Toys ‘R’ Us Didn’t Have to Die

#107

Post by sasaf5 »

jacobush wrote: post #89
sasaf5 wrote: post #67

Earlier quoted context omitted.

Anecdote time: I took my cousin (12) to a toy store once. First it was difficult to get him out of his iPad and get out of home. Second he was completely indifferent to anything in the store. We ended up buying some card games and credit for mobile games. + There aren't many kids anymore.

Kids. They don't make'm like they used to.

And they don't make them in the same quantities. I think what killed Toys R Us was demographics more than consumer trends.

Re: Toys ‘R’ Us Didn’t Have to Die

#108

Post by honestoHeminway »

aviv wrote: post #11
thisisit wrote: post #8

Retailing seems to be dying in US irrespective of the company: https://www.bloomberg.com/news/articles/2018-04-17/retail-st... Couple of years ago, one of my friends bought a store at a strip mall. The store was making a loss. And the previously owners were an elderly couple. So my friends thesis was that they weren't exactly tuned into the digital presence business and it was still entirely possible to run a store i…

In a few years strip malls will be occupied only by food businesses, pharmacies, check cashing places, and urgent care clinics.

Allready happened in china.

Re: Toys ‘R’ Us Didn’t Have to Die

#110

Post by sasaf5 »

nradov wrote: post #75
sasaf5 wrote: post #67

Earlier quoted context omitted.

Anecdote time: I took my cousin (12) to a toy store once. First it was difficult to get him out of his iPad and get out of home. Second he was completely indifferent to anything in the store. We ended up buying some card games and credit for mobile games. + There aren't many kids anymore.

I don't know why you're being down voted. For better or worse, this is common child behavior now.

I am curious: how to downvote in HN?
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