Toys R Us case study

Introduction Toys R Us is an American founded international company which mainly majored in different products ranging from toys, games, clothing and baby products (Dahlhoff, 2018). It has its headquarters in the metropolitan area of New York. Toys R Us originated as a furniture company and then pivoted to toys which was seen as a focus shift and has seen more than 65 years of success with a corresponding decline over time. Toys R Us pledged for bankruptcy protection in the United States and Canada. In the demise of Toys R Us there are different factors within its environment. Toys R Us was still in its bubble that it was the best retail toy store (Seiter, 1992). The consumers who were kids had changed in characteristics and become more digital.

Kids preferred online video games as compared to toys. There was a decrease in the number of people physically visiting stores as most people prefer ordering online or getting deliveries to their doorsteps. Since the society had changed more people preferred its competitors who gave them enough customer satisfaction hence losing many of its customers. One failure of Toy R Us was that they did not have an online presence. They had partnered with Amazon to retail their products online which strengthened Amazon, and led to the retailing of even competing company’s products on the same platform reducing the chances of Toys R Us (Roth, 2014). Due to no online presence, one had to visit the physical retail stores to acquire the products.

Since there was a decline in physical toys as most kids prefer video games and even virtual reality, there was no space for Toys R Us leading to its demise. The natural factors are described as the normal existing conditions. Toys R Us had suffered issues on supply and demand due to the lack of proper analysis. Toys R Us is still in the bubble where kids buy toys whereas kids have moved their preference to online video games which cannot be found in Toys R Us. The lack of analysis of the market led to the production of the same products that were released ten years ago and sold a large number of units whereas there has been a change in the market.

Toys R Us does not have a clear target market as the toys they make do not target the digital era kids (Roth, 2014). Lack of a target market has led to poor performance of product sales and the decline of Toys R Us. Toys R Us did not change their products and just stuck with the same products which had been overtaken by time. The demise was also because the kids of this era prefer video games to physical toys. Toys R Us did not consider this and kept producing the same products even though they were not selling (Raff, 2018). Overproduction then led to an overflow of products in their stores as they did not study the market which was new (Dahlhoff, 2018).

The distribution of products lacked as most of their products were in retail stores, and one could not order directly from Toys R Us. Finance entails allocation of resources over time and can be described as management of money. Finance deals with putting in cash towards the success of a company or an organization. Toys R Us had been bought by private investors, and hence it was to draw its finance from the investors. This finance could have led to the development of the company and even expansion. The funding had declined as Toys R Us had seen mismanagement of funds hence there was not enough resource to provide for the efficient running of the company (Raff, 2018). Toys R Us had hired a large number of people in all its retail stores who had it as their source of income (Ball, 2009).

Since Toys R Us was not making a profit, it could not generate enough revenue for its employees which led most of the workforce either quitting or getting laid off. Without a human resource the company could not work efficiently, and thus stores had to be closed (Raff, 2018). Technology which is a big part of this society is another factor which led to the failure of the toy retailer company. Technology entails the application of information to products and the process of developing those products. Problems facing the organization Toys R Us has faced different challenges over the years. Problems had increased over time and were present even before private investors bought the company. Toys R Us did not incorporate enough technology into its products hence could not serve the digital era kids.

Toys R Us suffers from mismanagement of the resources by the administration. Toys R Us did not re-evaluate its strategies even after declining sales and incurring losses from poor policy. Recommendation of the better Alternative The better and most profitable alternative is the use of technology which will go very well with the digital kids hence providing a market. Implementation Techniques Use of technology should apply to different parts of the production process. Technology is applicable in the use of equipment in development and design of products. Technology also comes in handy in the promotion of their products through social media and other online platforms. Technology can also serve in the creation of products like video games and virtual reality products.