Rumours of the impending demise of the Canadian Toys “R” Us stores have been swirling since the company’s U.S. parent filed for bankruptcy protection in September 2017.
At that time it wasn’t widely understood that the Canadian stores were separate of this filing and, in fact, somewhat profitable along with the other 1,600 stores around the globe.
News of a recent sale of the 81 Canadian stores speaks to the long-term viability of the retail toy franchise.
Toys are big business
According to industry reports, toy sales were not only resilient but spiked during the pandemic.
In Canada, the average yearly household expenditure on toys is $170, says market reporting from Statista.
The Canadian toy industry estimates sales increased by 12 per cent in 2020.
The phenomenon is not exclusive to Canada; globally, the toy market is expected to generate $120 billion (US) by 2023.
Pied Piper of Canadian retail
The successful Toys “R” Us buyer, Canadian entrepreneur Doug Putman, is no stranger to the toy business.
He is president of family-owned Everest Toys, which is a toy and game distributor.
Around since the early ’90s, the company knows its toys with partnerships to distribute brand like Hasbro, Mattel and Melissa & Doug.
Putman was virtually unknown to Canadian consumers until 2017, when he acquired 70 Canadian HMV locations and rebranded them to Sunrise Records.
During the pandemic he doubled down on retail, launching a tea-shop chain called T.Kettle in now-insolvent DavidsTea locations across the country.
If the price is right
Putman surely got a better deal on the sale than the parting owner, Fairfax Financial Holdings, which purchased the Canadian chain along with real estate holdings in 2018 for $300 million.
Meanwhile down south in the U.S., Toys “R” Us announced this month it will be popping up as kiosks in approximately 400 Macy’s department stores.