Toys R Us could close all 800 of its US stores — and blowout clearance sales could begin in a matter of weeks

  • Toys R Us is preparing to potentially close all of its US stores as part of a liquidation, according to several reports.
  • Blowout clearance sales at its roughly 800 stores could begin within a matter of weeks, according to Corali Lopez-Castro, a bankruptcy lawyer and managing partner at Kozyak Tropin and Throckmorton. 

Toys R Us is preparing to potentially close all of its US stores after weak holiday sales thwarted its plans to restructure the business through bankruptcy proceedings, according to several media reports.

That means blowout liquidation sales at its roughly 800 stores could begin within a matter of weeks, according to Corali Lopez-Castro, a bankruptcy lawyer and managing partner at Kozyak Tropin and Throckmorton. 

If the event of a liquidation, "Toys R Us is not going to want to drag this out," Lopez-Castro said.

The longer the stores stay open, the more rent Toys R Us will owe to its landlords.

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The company would only need a few weeks to heavily advertise the sales before kicking them off, she said. 

Toys R Us could announce whether it will liquidate its stores as soon as Monday following a bankruptcy hearing, the Wall Street Journal reported.

Toys R Us filed for bankruptcy in September and recently started clearance sales at about 170 stores that it plans to permanently close in April. 

The company has been shedding sales in large part due to growing competition from online retailers like Amazon. 

"Brick-and-mortar stores are just getting bludgeoned to death by e-commerce," Lopez-Castro said. "I don't think people will miss Toys R Us" if it goes out of business "because everything you can get at Toys R Us, you can get online."

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