NEW YORK (AP) — The first two new Toys R Us stores will open in November as part of a small comeback of the defunct iconic toy chain in the U.S.
Richard Barry, a former Toys R Us executive and now CEO of the new company called Tru Kids Brands, says an online experience will follow. He says brand partners and more details will be announced in coming weeks.
Plans are to open a store in The Galleria mall in Houston, Texas, and in Westfield Garden State Plaza in Paramus, New Jersey. The first two locations will be about 6,500 square feet — a fraction of the brand's former big box stores, which were about 30,000 square feet. Barry noted stores opened later will be about 10,000 square feet.
Tru Kids Brands said it has entered a partnership with a startup called b8Ta, an experiential retailer to launch what Barry calls an interactive store experience based on a consignment model. Toy makers will pay for space in the stores but will get all the sales.
Barry and several other former Toys R Us executives founded Tru Kids in January and are now managing the Toys R Us, Babies R Us and Geoffrey brands. Toys R Us generated $3 billion in global retail sales in 2018. Barry says a sizeable business is still up for grabs despite many retailers like Walmart and Target expanding their toy aisles.
The key issue, however, is how much support the new model will get from suppliers, who were burned by Toys R Us' quick demise and may not want to take another chance. Toys R Us, buckling under pressure from Amazon and several billions of dollars of debt, liquidated its U.S. business as well as other regions months after filing for Chapter 11 reorganization in the fall of 2017. That left them with millions of dollars in unpaid bills. Vendors recovered only about 20 cents on the dollar.
Tru Kids, based in Parsippany, New Jersey, is working with licensing partners to open about 70 stores this year in Asia, India and Europe. Outside the U.S., Toys R Us continues to operate about 800 stores.
"We think that this is going to be scalable, and we think we can grow the business over time," said Barry.