Toys 'R' Us to close

[George]

https://www.washingtonpost.com/news...800-of-its-u-s-stores/?utm_term=.8ff4e5202542

So sad.

 

[tango]

Sad for major chains to close their doors but arguably not hugely surprising.

As people shift their buying online the stores that relied heavily on old-fashioned "bricks-and-mortar" stores are going to struggle. When so many companies (I don't know if Toys-R-Us in particular did this but many have) go for all sorts of clever-sounding financial engineering schemes that essentially involve selling their tangible assets (typically stores) and then leasing them back, and then squander the money on doing little more than making the board wealthy, it's less surprising they are unable to weather a downturn.

Of course the increasing push to compete on price as a primary driver simply means that running a physical store is all but a guaranteed loss generator. If you hire staff who know what they are doing and pay them accordingly, there's a reason for people to come to your store but there's a good chance they will ask your staff the questions before buying their chosen product online to save a few bucks. If you replace knowledgeable staff with minimum wage staff you save some money but asking someone who doesn't know the answer is a frustrating alternative to looking over online reviews, and if you're reading reviews on Amazon you might as well just go ahead and buy the thing from Amazon.

In the UK Toys-R-Us are closing and the electronics retailer Maplin is also closing. While I feel sad for the workers who are almost certainly going to find themselves unemployed I really struggle to shed any tears over the demise of Maplin in particular, based on their limited selections and prices that are best described as "optimistic". If you needed something and you needed it right now, Maplin may be able to help (albeit for a price). If you could wait, buy it elsewhere.

In many ways these big name retailers are little more than poster children for what the internet promised to bring - namely that there was no longer an excuse to simply add your own profit margin to a chain without bringing something of value to the table. It's not entirely surprising that the traditional model of retail is gradually failing, being replaced by a combination of online superstores (Amazon etc) and more niche sellers of more custom items that provide a personal touch that large corporations can never do however much they insist they do.

 

[Josiah]

https://www.youtube.com/watch?v=VJJ-ZLdrTwY

 

[Josiah]

When I KNOW exactly what I want.... and am in no hurry.... I buy online (typically amazon). Easy. Usually cheapest.

But that's often not the case. Clothes for example, I never buy clothes online. I want to see it, feel it, maybe try it on. And the colors on the computer are never absolutely exact. And when there's something to fix or improve the house or church, I like to go to Ace Hardware (VERY helpful!) or even Lowes or Home Depot.... I like to see it, see how it fits, find out if I'm getting the right thing. More than once I've gathered up stuff... then sought a salesperson and asked, "Is this what I need?' And of course, sometimes I need it NOW. I'm willing to pay a bit to have it now and to have this ability to speak with KNOWLEDGEABLE staff and be able to touch and see.

I'm concerned that this FAST trend away from the "mortar and brick" stores will make the second more difficult. But maybe it will jsut mean what stores DO exist will specialize in knowledgable, HELPFUL service.... that we're willing to pay a bit extra to get. Perhaps it will just mean the end of minimum pay employees who don't have a clue and don't give a rip.


SIDE NOTE: We have a BIG mall near our house. It was built in the 1970's and remodeled a couple of times since. It's being ENTIRELY gutted and rebuilt... not really as a shopping center but as a community gathering spot with an emphasis on entertainment and restaurants. There will still be stores (4 of the 5 department stores are returning) but now a huge movie theater, huge fitness center, at least a dozen restaurants are moving in.... Gone will be most of the small stores.

 

[Krissy Cakes]

So sad indeed!

 

[psalms 91]

sad yes but their prices were high

 

[tango]

When I KNOW exactly what I want.... and am in no hurry.... I buy online (typically amazon). Easy. Usually cheapest.

Likewise, if I know just what I want I'll price-shop and then choose the best deal. That often means Amazon, especially since most things are at my door in two days at no extra cost, and I get extra cash back with the credit card I use.

But that's often not the case. Clothes for example, I never buy clothes online. I want to see it, feel it, maybe try it on. And the colors on the computer are never absolutely exact. And when there's something to fix or improve the house or church, I like to go to Ace Hardware (VERY helpful!) or even Lowes or Home Depot.... I like to see it, see how it fits, find out if I'm getting the right thing. More than once I've gathered up stuff... then sought a salesperson and asked, "Is this what I need?' And of course, sometimes I need it NOW. I'm willing to pay a bit to have it now and to have this ability to speak with KNOWLEDGEABLE staff and be able to touch and see.

I hate buying clothes at the best of times and, like you, want to see what they look like and how they fit. I'm a slightly odd shape and find that different brands are cut so differently that sometimes I can fit in a Large size comfortably while other times a 2XL feels a little snug.

As a rule my preferred source of hardware is my local hardware store. Their staff look after me, most of them know me given how many times I'm in there needing something to fix up my house. Often I'll buy something from there even knowing it's cheaper at the big box stores, because it has a value to me having a local hardware store. When there's a substantial price difference I have to take that into account but if the prices are more-or-less the same I don't mind paying a little more to support the local guy. It's not unheard of for me to be in the big box store and not buy something I need, because on the way home I drive past the local place and I'd rather buy it there, even at a marginally higher price.

I'm concerned that this FAST trend away from the "mortar and brick" stores will make the second more difficult. But maybe it will jsut mean what stores DO exist will specialize in knowledgable, HELPFUL service.... that we're willing to pay a bit extra to get. Perhaps it will just mean the end of minimum pay employees who don't have a clue and don't give a rip.

The problem here is that people will still go to the local store who pay more for staff who actually know and care what they are doing, gather the information they need, and then buy it from Amazon once they know exactly what they want. The store ends up with even higher costs to maintain not only a physical premises but knowledgeable staff and won't necessarily get the benefits of increased sales.

Where I used to live I had a bicycle shop barely 5 minutes walk from home. I bought two bikes from them, and they always looked after me well. When I broke a wheel the owner lent me a wheel to keep me on the road while I selected another one. When I talked to him about building a wheel he lent me a trashed wheel and a truing stand so I could practise on something that didn't matter if I broke something. Needless to say when I decided which truing stand I wanted, he got first chance to get the business. I made it a principle that if I knew exactly what I needed then I'd consider buying from him or online (and as above I'd buy from him if his price was more-or-less the same), but if I'd taken time from him or his staff finding out what I needed then I bought my selection from him if at all possible. It's a simple matter of giving a value to the store's time.

SIDE NOTE: We have a BIG mall near our house. It was built in the 1970's and remodeled a couple of times since. It's being ENTIRELY gutted and rebuilt... not really as a shopping center but as a community gathering spot with an emphasis on entertainment and restaurants. There will still be stores (4 of the 5 department stores are returning) but now a huge movie theater, huge fitness center, at least a dozen restaurants are moving in.... Gone will be most of the small stores.

I suspect that's going to happen more and more. It seems increasingly difficult to make much money in retail unless you're already a large corporation. I must admit I'm often surprised that the model of stores open during the day persists, because of course another huge drawback is that people who have money to buy the things they are selling probably have jobs, which mean they can't be in the stores during the day when they are open. Which is just another reason to buy online - during a lunch break I don't want to be fighting for space with everybody else on their lunch break, after work many retail outlets are closed, and at the weekend the last thing I want to do is spend my liimited time fighting for space with everyone else under the same time constraints. If I can decide what I need on Wednesday, buy it from my phone on the train on the way home, and have it arrive before Saturday when I need to use it, the time saving is worth far more than the often marginal cash saving. If anything I can see why people would pay more from Amazon for the convenience, especially now they are offering Amazon Lockers all over the place that means you don't even need to worry about when a courier might show up.

 

[Lamb]

I saw a meme on Facebook about this concerning Toys R Us donating millions of dollars to Planned Parenthood and how because of abortions they're actually losing their future customers.

 

[Albion]

We have a BIG mall near our house. It was built in the 1970's and remodeled a couple of times since. It's being ENTIRELY gutted and rebuilt... not really as a shopping center but as a community gathering spot with an emphasis on entertainment and restaurants. There will still be stores (4 of the 5 department stores are returning) but now a huge movie theater, huge fitness center, at least a dozen restaurants are moving in.... Gone will be most of the small stores.

That new use for the mall is in accord with what the mall consultants say should be done. Of course, it makes the mall be something that it used not to be, but at least the facility survives in some form.

The small stores find space in strip malls which, in many cities, were overbuilt during the late 20th century and so can easily accommodate the small businesses. The wonder is that, in your case, the big chain stores are returning to your mall. The same consultants posited that, with them gone, the smaller chain stores like TJMaxx could move up and take their place.

 

[tango]

That new use for the mall is in accord with what the mall consultants say should be done. Of course, it makes the mall be something that it used not to be, but at least the facility survives in some form.

The small stores find space in strip malls which, in many cities, were overbuilt during the late 20th century and so can easily accommodate the small businesses. The wonder is that, in your case, the big chain stores are returning to your mall. The same consultants posited that, with them gone, the smaller chain stores like TJMaxx could move up and take their place.

I often wonder why the larger stores bother with malls. Back in the day they may have been worthwhile but now it's hard to see what benefit a large chain store has from being in a mall. If they go it alone they can maintain their own hours and they can write their own rules rather than being constrained by the mall's requirements. The only benefit I can see to a large chain from being in a mall is if they get the retail space much cheaper than it would otherwise cost them, which just means the smaller retailers are being squeezed (again).

 

[Josiah]

The founder and long time CEO of Toys R Us died yesterday, at the age of 94. He lived just long enough to see his business fail.


Of course, as late as the 60's and even 70's, toy stores were independent "Mom and Pop" stores. But slowly, Toys R Us gobbled them up and ran them out of business. We see the same thing in the hardware and drug store businesses, etc. Thing is.... evolution tends to keep producing bigger predators....

 

[tango]

The founder and long time CEO of Toys R Us died yesterday, at the age of 94. He lived just long enough to see his business fail.


Of course, as late as the 60's and even 70's, toy stores were independent "Mom and Pop" stores. But slowly, Toys R Us gobbled them up and ran them out of business. We see the same thing in the hardware and drug store businesses, etc. Thing is.... evolution tends to keep producing bigger predators....

Evolution produces ever-bigger predators but also Nature finds a way to fill the smaller gaps.

When supermarkets first appeared their promise was "everything under one roof" and "we buy in bulk and pass the savings on to you". But now the chances are you can't get everything under one roof because the just-in-time stock control doesn't always work as well as it might, and the notion that they pass on the savings is frankly laughable. And then, for the rather dubious privilege of paying higher prices for often inferior products, you get to stand in line at the checkout because they didn't hire enough checkout assistants. Of course you can always check yourself out, thereby saving the store even more money that they still don't pass on to you.

With the relentless push to cut costs, and salaries being a fairly major cost when you've got lots of staff, the process of pushing wages down means the large retailers frequently either don't get people who want to stay very long, or they get people who don't care about doing a good job as long as they get a paycheck.

When the superstores fail to provide good pricing, fail to provide personal service, and fail to provide a very enjoyable shopping experience, it's hardly surprising they get squeezed from both directions - from above by the bigger predators like Amazon, and from below by a new range of smaller more nimble operators who may charge a little more but offer a more personal experience.

 

[Albion]

I often wonder why the larger stores bother with malls. Back in the day they may have been worthwhile but now it's hard to see what benefit a large chain store has from being in a mall. If they go it alone they can maintain their own hours and they can write their own rules rather than being constrained by the mall's requirements. The only benefit I can see to a large chain from being in a mall is if they get the retail space much cheaper than it would otherwise cost them, which just means the smaller retailers are being squeezed (again).

I dont think that rents are cheaper in the big malls than elsewhere, but I do know that the biggest corporations do cut special deals with the mall owners, some even owning, not renting, their units. The reason malls became important was, I think, that it was believed that with so many of the desirable shopping destinations gathered in one place, it would be the Mecca for local shoppers and bring more customers because they could shop a lot of outlets without driving between the stores or even going outside.

 

[tango]

I dont think that rents are cheaper in the big malls than elsewhere, but I do know that the biggest corporations do cut special deals with the mall owners, some even owning, not renting, their units. The reason malls became important was, I think, that it was believed that with so many of the desirable shopping destinations gathered in one place, it would be the Mecca for local shoppers and bring more customers because they could shop a lot of outlets without driving between the stores or even going outside.

Sure, my point is that if the huge stores cut special deals with the mall owners the mall owners have to fund it some other way, which will most likely mean hiking the rents for the smaller operators.

In years gone by it's easy to see why malls were popular - as you say you can visit a couple of dozen different retails, maybe more, without going outside. You can park in one place and go indoors, do all your shopping, then go back to your car once and go home. But now with malls dying out, much of the space left empty, and the easy availability of online shopping, there's less reason to go to them. If you've got good sized stores in the mall it can work, if you've got specific specials to draw people in it might work, but aside from that if you want to visit a dozen stores without going outside you might as well fire up your browser instead of going to the mall.

 

[Andrew]

Its sad to walk into best buy and never see the huge selection of cds

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