New Toys “R” Us store opens in Garden State Plaza in Paramus, New Jersey.
Source: Tru Kids Brand
Toys R Us has closed the only two stores it still had in the United States.
The iconic toy retailer made the decision as a result of the hardships caused by the Covid pandemic and plans to shift resources towards opening new locations with increased retail traffic, a spokesperson told CNBC in an emailed statement.
“Consumer demand in the toy category and for Toys R Us remains strong and we will continue to invest in the channels where customers want to experience our brand,” said the person.
Toy sales in the US were up 16% last year to $ 25.1 billion, market researcher The NPD Group reported Monday, as families turned to toys to keep kids busy during the health crisis. But a significant portion of those sales have gone online.
Tru Kids, an entity that acquired the Toys R Us intellectual property during its 2018 liquidation, opened two smaller stores in late 2019: one in Unibail-Rodamco-Westfield’s Garden State Plaza shopping center in Paramus, New Jersey, and a second in The Galleria of Simon Property Group in Houston. The Houston location closed on Jan. 15, the spokesman said, while the Paramus location closed on Tuesday.
Representatives for URW and Simon did not immediately respond to CNBC’s requests for comment.
Tru Kids still operates the Toys R Us website, which eventually sends customers to Amazon to make a purchase after they put toys on the market. It also continues to license the brand worldwide.
Many consumers left brick-and-mortar stores during the pandemic and bought more online instead. Shopping centers have suffered exceptionally. It will likely take some time for shoppers to adjust to going back to malls, and a retail research firm predicts that as many as 10,000 store closings could be announced by US retailers this year, setting a new record.
Bloomberg first reported on the Toys R Us closures on Friday.