Toys 'R' Us to add learning centers, PC software, baby registry in '95; image and service highlighted in annual report

Discount Store News, May 15, 1995

PARAMUS, N.J. -- Feeling the competitive pinch from discount department stores, Toys "R" Us will undertake some broad new initiatives in 1995 that should better position the specialty chain for growth.

This year, according to its 1994 annual report, Toys "R" Us will:

* Open 100 Learning Center store-within-a-store shops that offer a full assortment of learning-aid products and children's software;

* Debut a full selection of PC software at all U.S. stores as well as in several international markets;

* Greatly expand the space dedicated to large outdoor/ indoor play sets;

* Install a new automated Baby Registry program throughout the chain.

The toy retailer said that it is committed to improving its image through "a variety of pricing and marketing initiatives, the introduction of new in-store shops that highlight our dominant selection of merchandise and an increased emphasis on customer service," according to a letter to stockholders signed by vice chairman and ceo Michael Goldstein and Robert Nakasone, president and coo.

Toys "R" Us suffered from a downturn in video game sales in '94, the result of consumers awaiting the new generation of 32-bit and 64-bit video game systems by Sega, Sony and Nintendo. This should turn around later this year as these new technologies hit the shelves, creating excitement and sales during the fourth quarter.

Toys "R" Us' annual report stated the company's continuing efforts to improve its customer service program and the scheduled opening this year of a state-of-the art distribution center, the company's largest, in New Jersey. It also will open a DC in Germany.

Store counts will swell by another 100 units this year to about 1,100: 40 more toy stores in the United States on top of the yearend 618; about 50 internationally above the current 293; and 10 more Kids "R" Us children's apparel stores for a total of 214.

Toys "R" Us said that it will expand its franchise agreement program so that it can enter more countries in the years ahead. Toys "R" Us opened its first franchise store in January in Dubai and expects to open units in Israel, Saudi Arabia and the United Arab Emirates.

Overall, in 1994 Toys "R" Us recorded total corporate sales of over $8.7 billion and operating income of $844 million.