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What happened to Toys ‘R’ Us? Why the retail giant failed

Toys ‘R’ Us crashed into the UK market in the 1980s, building a series of toy warehouses across the country and quickly became THE name in toy sales for the country.

The company was originally an American retailer of toys, clothing and baby products founded in 1957.

Its first store was built in April 1948, with its headquarters located in Parsippany-Troy Hills, New Jersey and over the decades it became the dominant brand.

But competition from everything from supermarkets to online retail saw the company file for bankruptcy in 2017 and 2018, closing all of its US, UK and Australian locations, with the last US stores closing in 2021.

Operations in other international markets such as Asia and Africa were less affected, but chains in Canada, parts of Europe and Asia were eventually sold to third parties.

At the time of its North American bankruptcy in 2017, the company was facing $5 billion in long-term debt and needed to borrow $2 billion to pay suppliers for the upcoming holiday season.

The company had not made an annual profit since 2013 and reported a net loss of US$164 million in the quarter ending April 29, 2017.

It lost US$126 million in the same period of the previous year and had been paying US$400 million a year to pay off its debt, which prevented it from investing in improving experiments in store to compete with Amazon and Walmart.

Meanwhile, in the UK and Europe, on December 4, 2017, the company announced that it would liquidate and close at least 26 stores in the UK as part of an insolvency restructuring known as the company voluntary arrangement name.

After amassing £15million in unpaid tax, Toys ‘R’ Us Limited went into administration on February 28, 2018.

On March 2, 2018, it was announced that all UK stores would start a clearance sale, and on March 14, 2018, it was announced that all UK stores were to close within six weeks. On April 24, 2018, Toys “R” Us ceased trading in the UK after 33 years of service.