Weirdly I woke up this morning with a head full of ToysRUs calculations. If they had just over 100 stores and a turnover of around £450m isn't that approx. £3m per store once you've taken off an approximate amount
I was reading a discussion on Twitter about the Stockdale Paradox the other day. Based on a USA soldier who was captured by the Vietnamese and held for 8 years it is the concept that you must simultaneously remain optimistic about the future while planning for the worst.
This is definitely relevant for retail at the moment. We should not ignore the issues which surround us but, while remaining realistic, we can still maximise the many real opportunities open to us.
A toy shop as large as ToysRUs going bust sends ripples through the market. It highlights some weaknesses in UK retailing and brings the prospect of a lot of cheap stock sloshing around the marketplace.
So if I was a toy shop, a nursery shop or even a gift shop in a city near a ToysRUs I'd be thinking on the plus side that's £3m of consumer spend that's been freed up and is available, so can I get some of that for my shop, but at the same time I'd want to assess if there was a possible short term negative impact on my toy shop.
Obviously the first thing I would be doing is taking my trade price lists down to my local ToysRUs shop and comparing what they are selling their stock for and what my normal trade price is. Someone is going to buy that stock to lay away for future gifts for kids so why not let it be me, a toy shop! Theres no point buying it just because its cheap, many of the big toy brands stopped supplying months ago so it could just be the toys no one will buy that are left. Or there could be some toys that are not the newest, latest editions which would still sell in a July Sale or be used in promotions, or is there a perennial solid selling toy that I can buy cheaper than my trade price?
What about promotions. Can I buy any of their toys for promotions through the year? Only if you can sell at a profit and the toys are not all plastered with hi-tac stickers, but worth a good look.
Or perhaps the first thing I would be doing is having a long hard think about Xmas. Where will consumers go to buy their toys now? Some will want to go online which, if you have an online toy shop, is great. Not being an SEO expert myself I don't know if buying domain names is worth it but a quick check of cities where a ToysRUs shop is closing shows that domains like Toy Shop Oxford are available and cost just 99p. Sounds like that might be worth a gamble for when people start thinking about where to buy their toys at Xmas.
And what about toy brands that will not longer be available in your town once the shops have all closed? Are there any that would be worth trying? Will the toy brands be more receptive to you approaching them?
Perhaps you could even try different product areas, move in to baby toys or party gifts? Back when I was a retail buyer I spent many a happy hour counting the meters devoted to each product area in a competitor to try to assess how important it was to their turnover. Worth a go to judge whether it may be worth branching out?
And if you did any of these things could this be a good news story for local press and radio at Xmas to help get your toy shop name out there?
Now this is all very well but I am a Toy Wholesaler so this doesn't impact me at all. I'm not a Toy brand like Mattel or Hasbro nor have I ever sold to Toys RUs so why would this sad demise affect me at all?
Except that ToysRUs did plush, an awful lot of it. Plus they did baby toys and gifts for babies so perhaps I should stop pontificating about how shops could react and start looking at how we as a toy wholesaler could benefit from the sales which would have gone to ToysRUs and now may go through Independent Toy stores and Department stores? And at the same time what possible negative impact could the loss of the market leading toy shops have on our business?
So if you see a short woman in the Oxford store with a clipboard and price lists, that will be me! See you there
