Black Friday 2017 Toys R Us South Africa
Toys 'R' Us generates more than $2 billion in global retail sales annually.
Photo: Mark Kauzlarich/Bloomberg News
Geoffrey the Giraffe is coming to Macy's. M -5.16%
Toys "R" Us will roll out shops at more than 400 Macy's Inc. locations in the U.S. in 2022, the companies said, revamping the toy emporium's U.S. brick-and-mortar presence since it filed for bankruptcy in 2017.
The return to physical retail locations marks another effort to revive Toys "R" Us's footprint after two locations that opened in late 2019 in New Jersey and Texas closed in January because of the Covid-19 pandemic, leaving it without brick-and-mortar presence in the U.S.
For Macy's, the move comes as it plans to quintuple the size of its toy business, which has been a strong but small part of the company's operations, Macy's Chief Executive Jeff Gennette said Thursday. He said customers who come to buy toys will likely buy other things as well, translating into additional sales for the department-store chain. The partnership will give it "the opportunity to go after the category with a lot more vigor," Mr. Gennette said.
The companies said their partnership would also mean Macy's customers will be able to buy Toys "R" Us products online with Macy's digital and fulfillment system.
Toys "R" Us generates more than $2 billion in global retail sales annually through almost 900 branded stores outside the U.S. and e-commerce businesses in more than 25 countries, the company said. Brand-management company WHP Global Inc. earlier this year acquired a controlling stake in Toys "R" Us parent Tru Kids Inc.
The company was founded in 1948 by Charles Lazarus, a World War II veteran who started a baby-furniture store in Washington, D.C., to cater to the postwar baby-boom era. In 1957, he opened the first Toys "R" Us store. It was a novel concept: a toy supermarket with a broad assortment of products that customers picked off shelves to fill shopping carts. A cartoon giraffe named Geoffrey became the official company mascot appearing in television and print ads.
A hefty debt load and the rapid shift to online shopping led to Toys "R" Us's bankruptcy. Department stores, including Macy's, have lost out to discounters, fast-fashion retailers and online competitors. Their troubles worsened last year during the depths of the Covid-19 pandemic, when J.C. Penney, Neiman Marcus Group Inc., Lord & Taylor and Stage Stores Inc. filed for bankruptcy.
Macy's on Thursday posted net sales of $5.65 billion for the quarter ended July 31, up from $3.56 billion in the same period last year as it recorded better performances in pandemic-affected categories such as denim, luggage and dresses.
Meanwhile, toy companies are working to ensure enough supply for this year's holiday season amid logjams at seaports around the world. With supply-chain disruptions and rising costs for materials and labor, toy-industry veterans have said this year's disruption is worse than last year, when the Covid-19 outbreak temporarily shut ports, factories and stores.
—Suzanne Kapner contributed to the article.
Write to Dave Sebastian at dave.sebastian@wsj.com
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Appeared in the August 20, 2021, print edition as 'Toys 'R' Us to Open Inside Macy's.'
Black Friday 2017 Toys R Us South Africa
Source: https://www.wsj.com/articles/toys-r-us-to-open-shops-inside-more-than-400-macys-locations-in-2022-11629383928