Apr 08 2018

TRU, BRU, Us & You.

Toys R Us & Babies R Us to Close: Now what?

By Kelly Nelson   Business Development - Baby & Toy

I remember when Babies R Us first opened. Like many baby specialty store owners, my family was mortified that there was another big box baby shop coming onto the scene. It must have been a similar feeling for locally owned toy stores when Toys R Us first opened. Who knew, though, that the closure of these 2 chains would cause just as many issues for other retailers as the opening caused?

With the decision to close following the late 2017 bankruptcy filing by Toys R Us, the TRU checkbook has been closed leaving many vendors high & dry with unpaid invoices or allocated stock. The aftershock of this action is still pulsing through both the baby & toy industries with final outcomes waiting to be seen.

Given the scale of debt and the number of vendors, large & small, involved with TRU/BRU, here is what is likely to happen. It is probable that most vendors will tighten credit limits which will shrink retailers’ already declining open-to-buy budgets. Many vendors will be taking a significant financial hit and may have to let go of staff which could affect service levels to other retail partners. Brands are scaling back services and extras that they offer to retail partners in order to recoup costs where they can, though this may be a strategy that costs additional retail partners. Some brands will even likely go down with this ship possibly leaving retailers with unfulfilled orders and customers empty-handed.

On the other hand, while facing challenges with affected vendors, retailers are desperately working to grab shoppers from the BRU & TRU customer base. Companies involved in the land-grab style customer aquisition include the soon-to-be-resussitated KB Toys, Babylist, Buy Buy Baby, & other big box, ecomm, & independent shops in the space.

Buy Buy Baby registry offer

But what can baby & toy shops do to compete in this free-for-all customer grab? The answer is surprisingly simple. In addition to any ads or promos you may be running in order to catch these shoppers’ attention, there is one simple action you can take that won’t cost you a thing. You can advertise your stock on brands’ websites. For free.

If you are a retailer and you want to get in front of your customers on brand sites, go ahead & get started by claiming your store(s). Once you’ve claimed, you can log in and add your store logo, business hours, web & social links, in-store events, & even your store inventory, all of which is available on platform level partner brand sites.

If you are a brand, you may want to consider ways to spread your distribution, effectively keeping your eggs in multiple baskets. By working with Locally to point consumers to your brick and mortar shops, you are not only creating more options for customers to select your products but also showing retailers that you are a true partner. If you would like to see how the Locally tools can serve your brand, your customers, and your retail partners, visit brands.locally.com.

The rise and fall of the Toys R Us empire will be felt in many ways for a long time to come. What will you do, as a retailer or a brand, to adapt to this changing marketplace & how does this market change directly affect your business? Tell us in the comments on this post via Facebook. We look forward to hearing from you.

About Kelly Nelson

Kelly has over 20 years of experience in the baby industry having worked for her family's 3rd generation baby store, blogged for an industry publication, and served on industry committees. At Locally, Kelly uses her experience to help baby and children's products manufacturers and retailers leverage the web to promote in-store traffic.  View all posts by Kelly

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