Spoiling the joke

Many American parents young until today are able to sing a jingle that listened in childhood: "I don't want to grow up, because if I grow up, will you not let me play like a child Toys" R "Us". For the boys and girls of the 80 years, the stores Toys "R" Us, with your impressive range of dolls, caminhõezinhos, board games, bikes, paint, draw, and more, were the Mecca of toys. On 18 September, a good part of them he must have experienced a mixture of nostalgia and sadness with the news that the network had given entry to a bankruptcy filing.
Dave Brandon, Executive Chairman of the company, hastened to clarify that the stores would continue operating normally and that the decision marked the beginning of a bright new era for Toys "R" Us. "It was the right thing to do to ensure that the brands iconic Toys" R "Us and Babies" R "Us remains alive for many, many generations," said the Executive. Several analysts believe that the bankruptcy filing was a really sensible: only in this way the network can handle your long-term debt, currently at $ $5 billion. In other words, the Toys "R" Us is not dead. But that doesn't mean that your future is guaranteed.
The company's trajectory illustrates many of the difficulties faced by physical retail in United States. The problems started in the 90, when the hypermarkets have increased in number and size. Thanks to the wide range of offers from Walmart, consumers began to buy toys for their children in the same place that supplied their refrigerators.
Then came e-commerce. The toys are articles that fit pretty well to online shopping. Unlike a dress, the person does not have to try them to choose the right size, and, unlike a peach, you don't have to touch them to see if they are ripe. The routine of consumers who buy more toys, that is, the parents of small children, tends to be eventful. For women who are between 25 and 44 years doesn't leave much more time to go shopping than to eat and drink. Between access an internet site or move to a physical establishment to buy an electric train set, many parents opt for the first alternative, especially when you remember that, in a toy store, until the calmer children can turn into a lunatic insatiable. On Amazon there is that risk. The result is that many of those kids Toys "R" Us in the past have no desire to be parents Toys "R" Us today.
In the U.S., according to projections of the financial services firm Cowen, 41% of toys and video games are purchased online this year, roughly double the percentage purchased via the internet in 2009.
The Toys "R" Us also suffers from other ailments. The first of them is the weight of their debts. In 2005, the network was acquired by three private equity funds, leveraged that greatly increased your debt. As he breaks his back to compete with Amazon, the company spends, just with your debt, about $ $400 million per year. Other $ $400 million in securities with and without warranties expire next year. Many analysts already expected the bankruptcy, but the fact it happened on the eve of the start of the shopping season of new year's Eve shows how the company was out of breath. Two other retailers, Payless ShoeSource, a network of footwear from Kansas who started 61 years ago, and Gymboree, which began selling children's clothes in 1986, are among companies that have enacted bankruptcy this year after having been financed by private funds equity that the left also in debt.
Secondly, the Toys "R" Us is not helping. As with many networks of department stores, their purchasing managers showing slowness to adapt to new trends. Example: the explosion of sales of "fidget spinners", a kind of top modern-turned-fever in recent months, began on the internet. Also it is not clear if the strategy of trying to attract families to its stores with live events, like music lessons for children, it's going to work.
Like many other retailers, Toys "R" Us wants to strengthen your e-commerce business. Has not had much success. In 2000, when Amazon was trying to stop being just a bookstore, the retailer hit a partnership with e-commerce giant, who went on to manage online sales of their toys. Four years later, the Toys "R" Us sued his partner, claiming that the terms of the contract between the two had been disrespected. In 2006, the American Justice gave reason to the toy store. After 11 years, this legal victory appears to have been no consolation prize.