Project Team

1
Strategic Management Analysis

• Project Team
• Teress Brown s Lisa Hall s Kathy Hosch s Rioko Ono

November 28, 2007
2
Whats in the box?

• Overview
• History
• Diversification
• Brands
• Problems
• Analysis
• Recommendations
• Summary
• Questions?

3
The Beginning

• In 1948 Charles Lazarus opened Childrens
  Supermart
• Selling toys
• 10 years later - supermarket model
• Second store new name
• 1960 Geoffrey and a catchy jingle
• Became public in 1978

4
Diversification of

• 1980s diversified portfolio extending R Us
  brand
• 1983 launched Kids R Us
• 1984 went international
• 1996 launched Babies R Us

• 1998 introduced Imaginarium boutiques
• 1998 launched Toysrus.com
• 2001 opened flagship store
• 2004 launched Toysrus.ca

5
, Inc. - Brands
Toys R Us, Inc. is one of the leading retailers
of toys and baby products with more than 1,500
toy and baby specialty stores worldwide.
Toys R Us, U.S. 586 Stores throughout the U.S.
Babies R Us 254 Locations Nationwide
Toys R Us, International 685 Toys R Us 35
Babies R Us Stores
Toysrus.com Babiesrus.com
6
Problems

• New entrants
• Discount retailers
• Specialty competitors
• Poor competitive strategy
• Focused on diversification
• Offering
• Brick Mortar stores
• Average customer service

7
SWOT Analysis
Strengths
Weaknesses

• Brand Name
• Large Distribution Network
• Number of Stores
• Good Reputation
• Shelf Space
• Diversified
• Product Variety
• Safety Awareness

• Marketing (not focused)
• Declining Service Level
• Poor Store Layout
• No Customer Experience Offered
• Employee Training
• Stores Outdated and Dirty
• Depend Heavily on Holiday Sales

Threats
Opportunities

• Family Entertainment Options
• Discount Retailers
• Specialty Stores

• Alliances
• Support for the Community
• Organization Structure
• Special Toy Lines
• On Top of Latest Trends
• International Brand

8
Five Forces
Barriers to Entry
Supplier Power


Degree of Rivalry
-
Buyer Power
Threat of Substitutes
-
-
9
Initiatives FY2005 to present

• Acquisition July 2005
• Emphasis on safety
• Improve store Appearance
• Special store events
• Toys R Us Childrens Fund
• Charitable Partnerships

10
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11
Imaginarium
Fun For Us Area
Toyland
Sound Machine
Bike Shop
Babies R Us
R Us Duds
Game World
12
Recommendations

• New Store Design and Layout
• Offering a Unique Experience
• Strategic Locations
• Offer More Incentive Programs
• Kids Workshops
• Frequent Shopper Cards
• Improved Marketing Plan

13
Summary

• Advantage - Toys R Us Name
• Safety Concerns is Priority
• Take Back Market Share
• Improve Company Image
• New Merchandising Format
• New Business Plan
• A Winning Strategy

14
Questions ?