Unfortunately — or fortunately, depending on how you look at it — the retail industry is changing. As online shopping sees a drastic rise in popularity, in-person stores have been forced to think long and hard about how to better market and appeal to the new generation of virtual shoppers. More and more specialty stores and mall staples are closing down due to a decline in business, and one more may be on the way. So, given the recent news, will Toys "R" Us stores also close?
While the company has filed for bankruptcy, that doesn't mean they're going anywhere. On Monday, Toys "R" Us officially filed for bankruptcy, Reuters reported, "so that it can start paying suppliers to ensure it has Lego building blocks and Barbie dolls for the holiday season." The report continued:
The Chapter 11 filing, to restructure $5 billion of long-term debt, is among the largest ever by a specialty retailer and casts doubt over the future of the company’s 64,000 employees and nearly 1,600 stores, which remain open.
However, according to The Washington Post, Toys "R" Us has announced that it plans to keep all stores open and operating normally as they prepare for the upcoming holiday season.
In fact, Toys "R" Us CEO, Dave Brandon, said in a statement that this bankruptcy filing was almost like a fresh start for the company. "Together with our investors," he said, according to Reuters, "our objective is to work with our debtholders and other creditors to restructure the $5 billion of long-term debt on our balance sheet."
However, the company isn't planning on changing its core values to compete with online retailers. According to Reuters, "The company cautioned it was not going to engage in "an 'unrelenting race to the bottom' by trying to slash prices to compete with Amazon.com" — the only company that sells more toys than Toys "R" Us.
So, it doesn't seem like the company has any plans to close down stores, but will, in fact, attempt to make the in-person shopping experience at Toys "R" Us more enjoyable and unique.
In the company's press release about their bankruptcy, Brandon said, the refinancing would "provide us with greater financial flexibility to invest in our business, continue to improve the customer experience in our physical stores and online, and strengthen our competitive position in an increasingly challenging and rapidly changing retail marketplace worldwide."
And truly, it's become increasingly difficult for retailers to make themselves indispensable to consumers who could just as easily find what they need from the comfort of their own homes, often times at much cheaper prices.
However, Toys "R" Us really does have a unique and childlike feel about it that visiting the store is almost like an event, complete with jaunts down aisles filled with both memories for adults, and possibilities for children. And that childlike sense of wonderment is amplified around the holiday season.
"As the holiday season ramps up," Brandon said, "our physical and web stores are open for business, and our team members around the world look forward to continuing to put huge smiles on children’s faces."
Hopefully, Toys "R" Us will be able to pick itself up and move past the bankruptcy and fallout to continue to provide the truly iconic spirit that prevails in stores across the nation. Toys "R" Us was founded in 1948, and while many other toy stores haven't been able to survive throughout the years, Toys "R" Us has been able to stay afloat because of the fun environment it provides shoppers.
So, while it seems certain that Toys "R" Us will, in fact, stay open for the long run, it wouldn't be too shocking if it started to downsize, although not before the 2017 holiday season.
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