Party City Pounces on Void Left By Toys R Us

On June 25th, Party City announced its plan to open around 50 Toy City pop-up stores. This plan is directly following Toys R Us’ closing this week due to its bankruptcy back in September.

The temporary locations of Party City along with Halloween City pop-up shops are to appear in the optimal markets where the leasing opportunities are good for the company. Many retailers have negotiated favorable lease terms and rents due to the sudden appearance of vacant stores.

Party City hopes to fill the void left by Toys R Us’ unfortunate fall. Other companies such as Walmart, Barnes & Noble, Target, and Five Below could likely win some of the market shares as time goes on. KB Toys is also likely to make a comeback as toy vendors look for different venues to sell their merchandise.

The CEO of Party City, James Harrison mentioned the possibility of opening a Toy City concept. He stated it would be a nice complement to their current strategy of temporary seasonal retail. It could, in theory, leverage the capabilities of their existing pop-up stores. With the hole Toys R Us left, it could be advantageous for new companies to also enter the toy business.

The company said their pop-up shops centered around toys is slotted to open in September and run through the holidays.

According to Harrison, Party City plans to expand its assortment of toys online.

Party City Copies 2010 Toys R Us in Creation of Pop-up Stores

Through the cycle of retail reporting, there have been a lot of retail chains both large and mid-sized saying they plan on stepping in to work more closely with toys in regards to their sale.

Experts expect that over 75 percent of Toys R Us’ annual share will be reclaimed over time. Until then, we have to wait until retailers work out their strategies to win the customers over to them.

The process of Party City in creating pop-up shops is reminiscent of what Toys R Us did in 2010 after the fall of KB Toys and its file for bankruptcy. The void of toy retailers their fall made in malls created a wide opening for the other corporation to jump into. The hundreds of shops Toys R Us opened in malls stayed open through the holiday season that year. However, some of those temporary locations managed to remain open permanently.

In the end, Toys R Us fell due to its debt payments. The company had to liquidize when it was clear they couldn’t keep up with Amazon or invest in its business.