Retail

Toys R Us Pain Could Be Gain For The Children’s Place

Toys R U S Blockchain

In every story of less, there is usually someone who gained. In the case of the massive Toys R Us bankruptcy, children’s apparel retailer The Children’s Place could end up unexpectedly on the winner’s list.

According Retail Dive, Senior Research Analyst Susan Anderson of investment bank B. Riley FBR put out a report earlier this week saying that Babies R Us being suddenly out of the market means The Children’s Place has a chance to add as much as 2 percent to its revenue. In particular, the hole in the market coincides with the brand’s launch of a new line of infant products, Bundles Baby Place.

Babies R Us will leave an approximate $300 million hole in the industry $120 million of which was comprised of sales from baby-brand Carter’s. According to Anderson, Carter’s could make about half those sales via selling to other retailers. Other bands (smaller and less well-known players), she noted, will likely suffer through the liquidation of Toys R Us. And the folding of those brands could stack up to another chance for Carter’s to grab up market share.

The Children’s Place has benefited before from being still-standing while a noted competitor folded. CEO Jane Elfers said in a call with analysts, “[P]ast experience indicates that we generated $150,000 in sales on average in the first 12 months in our stores that are co-located in malls where Gymboree closed. Gymboree’s current round of liquidations represents approximately $30 million of opportunity for The Children’s Place.”

Though some apparel brands are forecast to rake in some extra funds, toy brands are eyeing a future that looks iffy- at best. Anderson notes that “wholesale partners are eager to work” with companies like Hasbro and Mattel to get a hold of “the companies’ iconic brands and market insights.” However, Hasbro and Mattel have a $1.3 billion problem to solve in a world without Toys R Us, and it is unknown if anything in the market could even hope to fill the hole that Toys R Us leaves behind.

Market-watchers expect the high-speed to come apart in the nation’s premier toy seller, which will mean that Target, Walmart, Amazon will have a lot more power to drive the market and use toys as loss leaders when it serves them to during the holiday season, for example.

——————————–

LATEST INSIGHTS:

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out the latest PYMNTS Digital Drive Report 

TRENDING RIGHT NOW

To Top