Amazon has contemplated buying Toys “R” Us locations, sources say
Following bankrupt toy retailer Toys “R” Us, Inc.’s announcement that it plans to shut down its US locations, e-commerce giant Amazon is said to have considered taking over some of the spaces to expand its brick-and-mortar footprint.
According to Bloomberg sources, the e-commerce platform would not be interested in maintaining the Toys “R” Us brand but has looked into acquiring the toy retailer’s stores for its own purposes.
Amazon has previously ventured into brick-and-mortar retail with a line of bookstores as well as a convenience concept but, following its purchase of Whole Foods Market Inc. and its 450 locations last year, the online platform would appear to be interested in further expanding its physical retail presence.
Benefits of an extended store network could include faster deliveries for e-commerce customers as Amazon grows its presence on the ground, and physical stores may also be a more effective platform for demonstrating Alexa voice-activated technology which the company has been investing in heavily.
Furthermore, despite e-commerce’s continued dominance, an increasing number of studies are showing that brick-and-mortar stores still very much have a place in the current retail landscape, especially when it comes to certain markets or products.
A recent report from First Insight, for example, revealed that men, in particular, still prefer to go in store to see and touch the product in person before purchasing, while research from the National Retail Foundation released last year claimed that millennial and Gen-Z consumers also favor the physical retail experience.
Nonetheless, the talks may well come to nothing. Amazon previously discussed buying some Radioshack stores when the electronics retailer filed for bankruptcy in 2015 but no deal was ever reached.
Toys “R” Us has already begun liquidating more than 700 of its locations in the US but is holding fire on 200 of its best performing stores in the hopes that, should a buyer for its healthier Canadian business come forward, they may be interested in continuing to operate some of its stateside locations.
Representatives of both Amazon and Toys “R” Us declined to comment.
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