SA Toys R Us plays on despite US bankruptcy
TOYS R Us South Africa has distanced itself from its US affiliate, which filed for bankruptcy this week, and said the South African business was performing well and was on an expansion drive.
Toys R Us SA marketing manager Nicole Annells said the local franchise had not been adversely affected by the bankruptcy.
Debt-ridden Toys R Us Inc filed for bankruptcy on Monday in Richmond, Virginia. But the South African retailer plans to increase its national footprint, and seven stores are expected to open during October and November, in addition to its current 53 stores.
Annells said yesterday that Amic Trading Toys R Us Southern Africa, registered in South Africa, was a privately owned, independent company operating under a licence agreement with Toys R Us Inc.
“Amic Trading functions entirely independently from the Toys R Us global affiliates. While Toys R Us Inc, which incorporates Toys R Us US and Canada, evaluates the restructuring of their operations and debt and continues to deliver an outstanding customer experience, this course has no bearing on the licence territories, which continue to trade as independent entities,” said Annells.
“The global strength and brand equity of the Toys R Us retail brand remain across all global retail locations. The business is, in fact, doing better than before.”
She attributed this to a dynamic team and a strong business model.
Toys R Us South Africa positioned itself as a mass retailer with the “best offering”, Annells said.
“Hamleys does not compete with Toys R Us directly, as they offer a different business model,” she said.
Asked whether Toys R Us SA was feeling the squeeze from online shopping, which was one of the factors that resulted in its US affiliate filing for bankruptcy, Annells said the company had embraced digital technology. It had a website and two apps, she said.