Some were unable to cope with changing market conditions. Some merchants had lagged because they could not compete against more streamlined, better financed competitors. They swooped in to ostensibly rescue retailers, offering cash secured against a retailer’s real estate. The real dagger to the heart of Toys ‘R’ Us and other retailers, however, has been the greedy tentacles of private equity fund managers. Toys ‘R’ Us added video games to its assortment, but one didn’t need to visit a store to upload apps to a hand-held device. ![]() With the advent of electronic games, computers and hand-held devices, traditional toys began losing their cache among children. In the age of the Internet, you searched on line, Amazon most likely. ![]() If you needed a specific toy, the place to go no longer was Toys ‘R’ Us. They siphoned off sales in buckets, not in dribs and drabs. They concentrated on the hottest toys, selling them at discounted prices. This advantage started to dissipate in the late 1980s as Walmart and Target refined their point-of-sale data systems. In-stock leadership, not price, cemented the company’s position as the go-to retailer for toys. The chain’s wide and deep inventory position became a strategic advantage when desperate parents and grandparents scavenged for the most wanted present during the holiday season. He partnered with suppliers, accepting early inventory deliveries and sharing sales data in return for discounts and assurances that Toys ‘R’ Us would be kept in stock on the most wanted toys. Lazarus was an early believer in the power of point-of-sale data. If not, there’s something wrong,” he used to say. “I should be able to close my eyes and walk 130 feet and put my hand down and touch the very same stack of items in each store. All business decisions – which products to carry, merchandising and store layout – emanated from headquarters. He believed staunchly in regimental uniformity. After customers kept asking for toys, Lazarus quickly evolved his merchandise mix to focus on toys. President George Bush meets the toy King Charles Lazarus at one of his storesĬharles Lazarus used $4,000 to transform his father’s Washington, DC bicycle shop into a juvenile furniture store. There were no suburban department stores or suburban shopping centres back then. When Toys ‘R’ Us began in 1948 if you wanted toys, an appliance or housewares item – virtually anything – you went downtown to a department store. But the graveyard list of ‘category killers’ is much larger. To be sure, a few copycat ‘category killers’ remain-Best Buy, Dick’s Sporting Goods, Bed Bath & Beyond, and even the struggling Barnes & Noble, to name several. Toys ‘R’ Us was the original ‘category killer’ chain that overwhelmed small specialty and large general merchandise stores by offering a supermarket-style presentation of wide and deep assortments of sharply priced category specific merchandise. With the liquidation bankruptcy filing of Toys ‘R’ Us, the era of the ‘category killer’ store may be said to be over. He will be missed by all who knew him and by countless children, some still young, some now grown up, some not yet conceived. ![]() Retailers with his merchandising, marketing and operational skills, linked by strategic perception and unmatched passion, are rare birds. He invented the ‘category killer’ discount specialty store concept copied in numerous merchandise categories. Among them, Lazarus would qualify for Mount Rushmore status. I had the good fortune of knowing some of the titans of the retail industry during the last half-century. ![]() Even if some parts of Toys ‘R’ Us may be resuscitated – toy suppliers are trying to cobble together a successor company – the chain will never be the same as when Lazarus commanded the toy industry. It seems somehow fitting that Lazarus did not outlast his creation. In my corporate obituary of Toys ‘R’ Us filed the day the retail giant folded I wrote, “I cannot imagine what must now be gripping his emotions” a broken heart, for sure. THE OFFICIAL CAUSE OF DEATH was reported as respiratory failure but, to me, any verdict other than ‘broken heart’ is a mischaracterisation.Ĭharles Lazarus, creator and guiding light of Toys ‘R’ Us for 46 years, died one week to the day after the company he founded in 1948 filed bankruptcy liquidation papers.
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