Toys R Us officially enters administration
The UK’s largest toy retailer, Toys R Us has officially entered into administration as of 28th February 2018. The organisation which was founded in 1948, have been on the brink of collapse for weeks following a number of poor trading periods.
London based insolvency practitioner Moorfields has stepped in as administrator and is expected to begin the process to break up the retailer’s estates. The administration is set to put around 3,000 UK jobs at risk, although all stores are expected to remain open until further notice.
The demise of the children’s toy retailer will leave a £37million pensions deficit in its wake, which means that the Pensions Protection Fund (PPF) will have to take on the costs to ensure that employee’s pensions aren’t affected.
Just before the Christmas period, Toys R Us managed to secure a company voluntary agreement (CVA). The CVA had plans in place to shut down 26 of its stores that were making a loss, as well as planning to cut around 800 jobs during the spring as a last minute rescue for the business.
The roots of the business failure go further than the last few weeks; the store format provided no customer engagement – lots of stock alone is no longer enough for demanding customers – and there was nothing child friendly about the stores. Another case of times and fashion moving at a pace that the high street can’t keep up with.
If you are worried about the administration of Toys R Us and whether it will have an effect on your business, please do not hesitate to contact us on 01275 817320.