For toy makers, the unexpected liquidation of Toys R Us was a financial calamity and represented the loss of a major partner in the market — the last national dedicated toy chain. For retailers, it’s a huge opportunity for growth, and retailers from Party City to Kohl’s are swarming the category like piranhas to get their piece of Toys R Us’ forsaken $1.3 billion in U.S. toy sales.
Walmart has loomed large over the sector for years already. The mass merchant was already one of the largest toy sellers and competitors to Toys R Us before the toy retailer went into Chapter 11. Arguably, Walmart’s aggressive pricing on toys was a contributing factor to the Toys R Us’ demise, as the latter — saddled with billions in debt from a leveraged buyout — suffered from chronic underinvestment in its business over the years.
