KB Toys in chapter 11 will close its doors forever
Nothing could be more shocking than to see KB Toys closing it's doors after 86 years of service in Florida right before Christmas.
For the second time in four years, KB Toys is filing for bankruptcy protection. Plans for a going out of business sale has been put into affect immediately.
Located in Central Florida, KB claims that it's decline in toy sales is directly related to the sharp deline in the economy. Typically, most stores generate at least 1/2 their revenues during the Christmas season. From $10.4 billion in toy sales, analysts estimate that toy sales may be down slightly this year due to consumer cut-backs.
Many toy manufacturers have cut prices to try and entice cash-strapped consumers but to no avail. Some have offered deep discounts of $10 or less down from last year this includes "Buy Two and Get One Free" promotions. The Delaware U.S. Bankruptcy filing indicated that store sales between October - December fell 20%.
Stores will be liquidated by means of going out-of-business sales in order to cover debt in addition to selling its entire distribution business. Chapter 11 permits a greater control over the sale of its assets as appose to Chapter 7 where a trusty takes over the liquidation.
Soon the KB Toys name in 40 strip mall stores, 30 holiday stores, and 114 outlet stores will become a part of history. Kb Toys which has enjoy $480 million in yearly sales is now in debt between $100 to $500 million.
Perhaps KB Toys upper managment decision not to sell the popular video game consoles including Nintendo and Wii hurt the profit margin this year.
But whatever the case, we sadly say, "goodby" to one of the America's finest legacy toy stores.
For the second time in four years, KB Toys is filing for bankruptcy protection. Plans for a going out of business sale has been put into affect immediately.
Located in Central Florida, KB claims that it's decline in toy sales is directly related to the sharp deline in the economy. Typically, most stores generate at least 1/2 their revenues during the Christmas season. From $10.4 billion in toy sales, analysts estimate that toy sales may be down slightly this year due to consumer cut-backs.
Many toy manufacturers have cut prices to try and entice cash-strapped consumers but to no avail. Some have offered deep discounts of $10 or less down from last year this includes "Buy Two and Get One Free" promotions. The Delaware U.S. Bankruptcy filing indicated that store sales between October - December fell 20%.
Stores will be liquidated by means of going out-of-business sales in order to cover debt in addition to selling its entire distribution business. Chapter 11 permits a greater control over the sale of its assets as appose to Chapter 7 where a trusty takes over the liquidation.
Soon the KB Toys name in 40 strip mall stores, 30 holiday stores, and 114 outlet stores will become a part of history. Kb Toys which has enjoy $480 million in yearly sales is now in debt between $100 to $500 million.
Perhaps KB Toys upper managment decision not to sell the popular video game consoles including Nintendo and Wii hurt the profit margin this year.
But whatever the case, we sadly say, "goodby" to one of the America's finest legacy toy stores.
posted by michael at
10:37 AM
