Toys R Us

Region: 
Private: 
Public: 
Ticker: 
Private
Market cap: 
Country of incorporation: 
United States of America
Industry: 
Consumer Discretionary
Description: 

Toys “R” Us, Inc. is a retailer of toys, baby-juvenile products, electronic products and children’s apparel. The Company operates all of the “R” Us branded retail stores in the United States and Puerto Rico, as well as approximately 70% of the “R” Us branded retail stores. The balance of the “R” Us branded retail stores outside the United States are operated by franchisees and licensees. Toys "R" Us also sells merchandise through its Internet sites at www.toysrus.com and www.babiesrus.com in the United States, and through other Internet sites internationally. As of February 2, 2008, it operated 1,560 “R” Us branded retail stores in toy store; specialty baby-juvenile store; side-by-side store; and “R” superstore formats. Toys "R" Us has two reportable segments, Toys “R” Us – United States and Toys “R” Us – International, and Babies “R” Us (Babies). The Company’s products fall under learning, entertainment, core toy, and juvenile categories1.

  1. 1. http://www.google.com/finance?cid=703714
Positive Impact – Doing: 

1. 03.31.08 - Toys R Us launched eco-friendly toys including natural wooden toys, natural cotton plush animals and organic cotton dolls on Earth day last year. Packaging of the toys uses no less than 70% recyclable materials and carries a green "R" with the words "Recycle, Renew, Reuse, Re-think". The natural wooden toys are marked with the Forest Stewardship Council logo. The natural cotton plush animals and organic cotton dolls are colored using natural or water-based dyes and are made with unprocessed, unbleached and untreated cotton.1
2. 11.09.09 The company is actively managing health and safety issues concerning its products. This is evident in the way it is proactive and candid about product recalls. The website has an up-to-date reporting on recalls incuding as recent as recalls made today.2. This is further substantiated by the fact that Daily Green nominated Toys R Us for the 2009 Heart of Green Award for discontinuing sale of baby products that contained Bisphenol A (a harmful chemical).3. Also, the company has a dedicated section on safety standards, practices and policies.4.

  1. 1. http://www.environmentalleader.com/2008/03/31/toys-r-us-launches-eco-friendly-toys-green-logo/
  2. 2. http://www5.toysrus.com/safety/prodRecallsList.cfm
  3. 3. http://www.thedailygreen.com/environmental-news/latest/heart-of-green-business-47041004
  4. 4. http://www5.toysrus.com/safety/safetyPractices.cfm
Positive Impact – Talking: 

1. 03.01.04. Toys 'R' Us was the first in its sector to join the CARE Process, International Council of Toy Industries' (ICTI) ethical manufacturing program aimed at ensuring fair labor treatment in the toy industry supply chain, worldwide. The fully transparent process begins with a Code of Business Practices, factory Audit Checklist and Guidance Document and runs straight through to the annual certification/recertification, via independent audits. Within a specified timeframe, all toy manufacturers are expected to only utilize manufacturing facilities that are certified under the program.1.

  1. 1. http://www.allbusiness.com/manufacturing/miscellaneous-mfg-doll-toy-games-games/5633266-1.html
Controversy: 

1. Toys r Us makes no explicit effort towards any form of environmental or social responsibility. For a retailer of this size, that is unacceptable.
2. Numerous reports reveal the horrendous conditions of the Chinese labor force manufacturing toys for Toys R Us1
3. Several discrimination suits have been filed including black shoppers who were unfairly targeted for receipt checks2 and a Hispanic employee who was fired after complaining to managment about discriminatory harrassment he was being subjected to by fellow emplyees3
4. 04.02.08 - The company's initiative to launch eco-friendly toys seems to be a reactive approach to last year's lead paint/ phthalate/magnet scares as opposed to being a pro-active approach to sustainability. Since, most of the toys are still manufactured in China and there is lack of transparency on the health & safety portion of the manufacturing process, there seems to be parental concerns and skepticism over the issue.4
5. 06.06.08 - As a member of ICTI's ethical manufacturing program, CARE, Toy R Us is expected to buy all its toys from manufacturing factories that must fulfil audit requirements and be reviewed annually under CARE. However, as of 06.06.08, Toys R Us Australia had not sourced any of the toys from factories authorized under the CARE process.5.

  1. 1. http://www.business-humanrights.org/Categories/Individualcompanies/T/ToysRUs?&&batch_start=21
  2. 2. http://www.reuters.com/article/domesticNews/idUSN1128989720070711
  3. 3. http://seattle.bizjournals.com/seattle/stories/2007/06/25/daily12.html
  4. 4. http://ecochildsplay.com/2008/04/02/toys-r-us-new-toys-eco-friendly-still-made-in-china/
  5. 5. http://www.choice.com.au/Reviews-and-Tests/Babies-and-Kids/Fact-sheets/Safety/CHOICEs-toy-industry-survey/Page/Results.aspx
Notes: 

Lead usage in toys is within US Consumer Product Safety Act regulations limit (90ppm for surface coating and 300 ppm for substrate (non-surface coating); however, why should any toxic materials be used in children's toys? HQ in Wayne, NJ.

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