Toys R Us closing 180 stores

Orange County businesses, careers and personal finance
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John Q. Public
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Toys R Us closing 180 stores

Postby John Q. Public » Wed Jan 24, 2018 10:29 am

Southern California locations:

Indio
Simi Valley
Santa Clarita
West Covina
Puente Hills
Brea
Westminster
Torrance
Riverside/Moreno Valley
Santa Ana
Corona
Mission Bay
Mira Mesa
Vista

List of other locations in USA Today

I'm not familiar with a few of them, like Brea Mall, Santa Ana and Puente Hills, but I'm assuming those are Christmas "pop-up" stores that they left open. I know their old Brea store died horribly about 15 years ago, so I don't know why they'd open another full-sized store there. Rent is probably a factor on some of them because I know a few of them do pretty good business. Many are full-size stand-alone or strip mall stores.

Blame is only partially on online shopping, since they did "Ship-From-Store" where the stores got the business from online shoppers. The real story is debt. Massive amounts of debt from a leveraged buyout many years ago. And their pricing. They're always about 10% higher than their competitors. Walmart uses pretty much a "cost+" model and TRU uses "dynamic pricing," which is more of a "what the market will bear" kind of model. As demand for an item goes up, so does the price. Amazon is the same. At Wallyworld, the price goes down or stays the same.

They came into the market in the '70's, killed off the independents with their selection and lower prices, got bought by corporate raiders, got greedy at a time when that wasn't a good idea and now they're paying the price. I have pity for their employees but not their owners.

Another shame is that back when it was publicly traded, it was a great stock "flip". The price always went to about half in November and then doubled when holiday results were announced in January. There was talk that they might be going public again but it doesn't sound like it now.


Don't look at me, I just work here.

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