Toys R Us goes into administration with 3,000 job losses as 106 stores face closure
RETAIL giant Toys R Us has gone bust putting 3,000 people out of a job.
Attempts to sell the business have failed, meaning that the retailer will start plans to close down potentially all of its 106 UK stores.
The toy giant has confirmed that it will be holding closing down sales in stores that they plan to close for good.
Corporate company Moorfields, who worked on video rental chain Blockbuster five years ago, has been appointed as joint administrators to overlook Toys R Us' insolvency.
Customers can expect huge "clearance discounts and other special promotions" in stores and online as the retailers bids to shift the stock.
Simon Thomas from Moorfields, said: "Whilst this process is likely to affect many Toys R Us staff, whether some or all of the stores will close remains to be decided.
TOYS R US has now gone into administration. Here are your rights.
Toys R Us has gone into administration: here are your rights
- Stores will remain open until further notice and stock will be subject to a clearance discount or other special promotions
- Use your giftcards and vouchers asap. Toys R Us says they be continued to be accepted but they could withdraw this at any time.
- Time to Pay. You can continue to pay off items and collect them until March 11. If you decide you no longer want the item then you'll be able to use the money towards the cost of another item in-store until March 11.
- Customers will no longer be able to use "click and collect" or order items online. All outstanding orders will be fulfilled as long as there's stock available.
- If you've bought an item and you want to get your money back. While a company is still trading it should continue to honour your return rights.
- Once a company enters administration you may have to claim back money from your credit card or debit card provider.
- If you bought the item using a credit card then you'll be covered under Section 75 of the Consumer Credit Act - as long as you spent over £100 and under £30,000.
- If you paid using a debit card then you can claim back the cash from your bank using Chargeback.
- If you've bought presents online and paid by PayPal, you may be able to get money back by its Buyer Protection policy if they don't arrive or it doesn't match the seller's description.
- To do this you must first raise a dispute with the seller - you have 180 days to do this after you've made the payment.
"We have informed employees about the process this morning and will continue to keep them updated on developments.
"We are grateful for the commitment and hard work of employees as the business continues to trade."
The administrators are yet to confirm what will happen to employees.
The retailer has been in trouble for some time now, fighting to pay off a £15million VAT bill thanks to weak Christmas trading.
Before Christmas it had hoped to have staved-off the threat of administration after reaching a deal with UK's pension lifeboat to plug a £9million blackhole.
The retailer had until February 27 to pay off the bills but now the deadline has passed, the retailer's future isn't looking hopeful.
As part of the firm's Company Voluntary Agreement (CVA) agreement, it had announced that it will be closing 25 of its 106 stores across the country this spring leaving 800 people without a job.
The stores affected launched a closing down sale with up to 30 per cent off on some items. The deals include slashed prices on toys, car seats, pushchairs and bikes, as well as all of the Babies R Us stock too.
Which? consumer rights advice for customers of Toys R Us
Alex Neill from consumer group Which? said: "It’s a worrying time for everyone when a company goes into administration but for customers it’s important to remember that your consumer rights may be affected.
"If you have recently bought anything from Toys R Us, you may not be able to claim a refund or exchange the item if they cease trading. If you have Toys R Us gift vouchers you should try to spend these in-store as soon as possible.
"If you are planning to shop in Toys R Us and intend to buy something worth more than £100, make sure you use a credit card as you’ll be able to make a claim against your credit card company under Section 75 Consumer Credit Act if anything goes wrong."
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At the beginning of the month, it was reported the company's American bosses had begun an "urgent search for a buyer" for the UK business after poor Christmas trading.
The company has said its large, warehouse style stores, which were opened in the 1980s and 1990s are now too big and expensive to run.
Toys R Us filed for bankruptcy in the US and Canada last September, whilst the entire European side of the store business including 236 stores outside the UK in 10 countries is also on the market.
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