However, the late 90s were also when Toys R Us started experiencing the first big problems, including major competition from other bargain retailers, like Walmart and Kmart, and a serious loss in court to the Federal Trade Commission (FTC). Japan would go on to become its biggest overseas market. By 1996, the company already had 55 international toy stores. The company also expanded into selling children’s clothing during this time.īy the early 90s, Toys R Us dominated toy sales so much that it forced other popular toy retailers, such as Child World and Lionel, to file for bankruptcy, foreshadowing what would eventually come for Toys R Us itself.Īround this time, Toys R Us was also expanding into international markets, including Japan and Europe. In just five more years, from 1978 to 1983, Toys R Us more than doubled its number of stores and market share to 169 stores and 12.5% of the toy sales market. Over the next few decades, Lazarus was able to dominate the toy sales market by negotiating lucrative contracts and selling toys at prices 20% to 50% lower than competitors.īy 1978, Toys R Us had 72 stores and controlled an impressive five percent of the entire US toy market, resulting in profits of approximately $36 million that year. In 1957, he started a separate company focused solely on toys, thus leading to the founding of the first Toys R Us. In 1948, he founded a baby furniture store called Children's Bargaintown, which he later sold to Interstate Department Stores in 1966. Toys R Us founder Charles Lazarus saw an opportunity to capitalize on the post-war “baby boom” by selling baby furniture and other children’s goods. However, Toys R Us fell on hard times starting around the early 2000s, ultimately leading to the company selling and closing all of its brick-and-mortar stores, which we’ll go into more detail on below. At its peak, Toys R Us operated 739 US-based stores and 750+ stores in foreign markets. Toys R Us enjoyed much success for many decades as children’s toys and the technology behind them boomed through the 60s, 70s, 80s, and 90s. The company’s trademarked name, Toys R Us, is a stylized version of the phrase “toys are us.”
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