On Tuesday, Toys “R” Us announced that it would be shuttering close to a fifth of its U.S. stores over the upcoming months, as the chain of toy stores attempts to emerge from one of the biggest-ever specialty retailer bankruptcies.
The company will close as many as 180 stores in the U.S. starting the early part of February and will continue through mid-April, said CEO David Brandon in a letter posted on the company’s website.
Brandon, who become the company’s CEO during 2015 following his spearheading of a turnaround for Domino’s Pizza, acknowledged the gaps that existed in customer experience for the all-important holiday shopping season, but made a pledge to focus on the improvement of the shopping experience both in stores as well as online.
The company, based in Wayne, New Jersey, dealing with the growing competition from online behemoth Amazon.com and regional toy retailers, will roll out huge discounts as well as revamp the company loyalty program to attract more shoppers.
Just prior to the holiday shopping season of last year, the company filed bankruptcy to restructure more than $5 billion long-term debt, which cast doubts over what would happen to more than 64,000 employees as well as 1,600 stores.
Toys “R” Us is also the operator of Babies “R” Us that focuses on infant as well as toddler toys, has set aside over $400 million of the $3.1 billion in loans it received for making over stores the upcoming three years, with higher-paid staff and more customer experience.
The company announced that it is planning to remodel several of its locations through converting them to co-branded stores that will have both Toy “R” Us and Babies “R” Us, while also making a large investment in its websites.
All 83 Canada-based Toys “R” Us stores will stay open, said Melanie Teed-Murch the president of the company’s Canadian unit, in a letter sent out to clients.
As the toy store chain looks to exit its bankruptcy during this year, its efforts of reinventing its look will shape the way other retailers aim at changing experiential shopping to fight against the pressure from e-commerce.
The retail world enjoyed a strong holiday shopping season in 2017, but that was not enough to make up for the slump during the other 10 months of the year.