The Resurgence of Toys R Us


Luke Goodman

Imagine this: it’s 2009, and your parents are driving you to Toys R Us. You just hopped out of the backseat of your parent’s car, overwhelmed with joy and excitement. You run into the store, and hours later, you reemerge with loads of fun. This was every child’s dream. 

Now, you’re grown and miserable. Don’t cry yet, though, because next year you’ll be able to once again drown your sorrows in Toys R Us. After filing for bankruptcy in 2018, the corporation is back again. Under new management, Toys R Us is being brought back to over 400 Macy’s locations nationwide. That’s right, Macy’s is taking over Toys R Us, and opening new stores inside of their pre-existing locations. It’s bittersweet; the brand we grew to love as children is being resurrected for children in this generation and beyond. 

The first generation of children basked in the joy of Toys R Us starting in June of 1957, when the soon-to-be legendary toy corporation was first founded and in its infancy. But, the company’s origins actually go back farther than that. In April 1948, Charles Lazarus founded a baby-furniture store called “Children’s Bargaintown” in Washington D.C. during the summit of the post-war baby boom. Lazarus, a World War II veteran himself, sought to capitalize on the baby boom, thus he opened a child-furniture store. 

Children’s Bargaintown stood tall for all of nine years, until Lazarus decided to rebrand. He realized that although young children might grow out of  cribs and cradles, they would never get tired of toys. He expanded his company from solely baby furniture to children’s toys as well, and the first of Lazarus’ stores dedicated entirely to children’s toys was opened in Rockville, Maryland in 1957, which he named, “Toys R Us.”

The primary reason for the corporation’s massive success in the following years was largely attributed to Lazarus’ judicious business decisions. He cornered the market by simply buying and selling large amounts of toys so that he could obtain more lucrative contracts than his competitors. He then made the decision to sell his brand to Interstate Sales in 1966, to finance a larger national expansion of the corporation. This allowed Lazarus to transfer from chief executive to head of the Toys R Us division. Interstate Sales bolstered the company’s ever-growing success, and sales skyrocketed from there. By 1969, the corporation, under Interstate Sales, adopted “Geoffrey the Giraffe” as its official mascot. Toys R Us was different than any other toy store ever seen before, simply because of the size of their stores and variety of toys they offered. As Lazarus said, “Toys R Us is a supermarket for toys.” Interstate Sales filed for bankruptcy in 1974. Lazarus was given the task of restructuring the company, and he had successfully pulled them back out of bankruptcy by 1978. By the 1990s, Toys R Us was a public company trading on the New York Stock exchange, with booming sales. By 2005, investment companies Bain Capital, KKR and Vornado privatized the corporation, purchasing it for roughly $6.6 billion, going into more than $5 billion in debt. This was the beginning of the end for Toys R Us. 

In 2005, Jeff Bezos was worth $4.8 billion, entirely due to the extreme success of his company, Amazon. Amazon allows consumers to access millions of items across the globe at their fingertips, including children’s toys. It’s quite simple why everybody unintentionally abandoned the children’s toy store we’ve grown to love; Amazon is  more convenient. While Amazon’s profits increased, Toys R Us’s annual profit decreased each year for seven years, up until 2013, where they reported zero annual profit. They’ve reported zero annual profit every year since. By 2017, Toys R Us filed chapter 11 bankruptcy, and in 2019, they filed plans with the bankruptcy court to close over 182 locations nationally. The company has essentially been dead ever since. Until now. 

On August 19 2021, Toys R Us publicly announced their partnership with Macy’s through Twitter. It was then that Toys R Us announced that customers would now be able to buy their products through the Macy’s website, and in 2022, Toys R Us is going to be available inside of over 400 Macy’s locations nationwide. The primary reason for Macy’s purchasing of Toys R Us aligns with their 3-year Macy’s “Polaris” plan, launched in February of 2020. Essentially, Macy’s Polaris plan is to corner the under-forty market, explore new revenue streams, accelerate digital growth, and set the company up for sustainable growth. Toys R Us, being a children’s toy store, is bound to capture its portion of the under-40 market, while the creation of digital Toys R Us shopping through the Macy’s website accelerates digital purchases. Toys R Us has certainly seen its highs and lows. Now, it is back again; whether it sticks, only time will tell.