Toys “R” Us has gone into voluntary administration
Another huge chain store has officially gone into voluntary administration.
Only a few months after the US and UK retail giant's collapse, Toys "R" Us Australia has gone into voluntary administration.
As a result, the company has decided to appoint voluntary administrators McGrath Nicol after the final bidder for the sale of Australian business withdrew, stated McGrathNicol on Monday.
Don't fret as of yet, all Toys "R" Us stores will remain open and continue to run while administrators aim to explore more options for the brand. The company currently operates 44 stand-alone retail stores and has over 700 employees. At this point, a spokesman for Toys "R" Us has noted that none of these employees will be affected by this change.
McGrath Nicol stated that it would “urgently explore options for completing a sale of the stand-alone Australian business as a going concern, or a recapitalisation through the Voluntary Administration process”.
They also noted that gift vouchers would be honoured. However, you need to spend the equivalent amount of the vouchers in store. That means if you have a $50 gift voucher, you also need to spend $50 in store. Online orders will also only be delivered if the goods are paid for and available.
Just last year, Toys "R" Us filed for bankruptcy in the US and then sadly in March, chief executive David Brandon told employees that more than 700 locations and 33,000 jobs would go. Soon after, the UK and Ireland followed suit closing up their stores. The US stores blamed the significant discounting of toys from retailers like Amazon and Kmart for the downfall.
Only last week we saw Metalicus announced its voluntary administration, joining brands like Surfstitch and Oroton who also have made the same announcements with many being affected by high rents and weak levels of household spending growth.
Toys "R" Us insist that it will continue to run as normal but that hasn't stopped speculation that the brand may partner up with Asian stores and sell as a whole.
Nevertheless, we hope to see an uplift for the brand as they have been a staple part of Australian retail for many years, but only time will tell.
Stay tuned for more updates!
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