Toys "R" Us, the big box store of toy retailers, filed for Chapter 11 bankruptcy protection in federal court in Richmond, VA., and said it will use the protection to come to terms with its debt holders and other creditors to restructure its $5 billion in debt.
The retailer, in an announcement late Monday night, said its stores will remain open and that it is prepared for the important holiday season. Still, that leaves customers with many questions. Here are a few answers.
Will stores be closing?
No, not immediately. Toys "R" Us has received bankruptcy financing that will allow it to maintain all existing stores and operations while it reorganizes.
Will the stores start having liquidation or going-out-of-business sales?
Again, not immediately. Toys "R" Us says they will be operating the same sales and promotions their shoppers have always loved, and it will be business as usual.
I am registered at Babies "R" Us and I don't need this stress. Help!
Relax. All baby and gift registries will remain up and running.
I have a Toys "R" Us gift card. Should I spend it right away?
Toys "R" Us would love you to, but no need to. Gift cards will be honored as usual and you will have plenty of advance warning if that changes.
Will return policies and warranties be affected?
No. Toys says it will continue to accept all returns and honor all warranties.
What about my Toys "R" Us credit card?
Can I still earn Rewards "R" Us points?
Yes. The Toys "R" Us loyalty program remains in effect.
Will Toys still have the hot holiday must-have toys?
Toys "R" Us says it is well stocked for the holidays. It has good relationships with toy makers, and they want it to survive, so they most likely will continue shipping to Toys "R" Us as usual. But some manufacturers may be worried about getting paid and hold off on rush shipments or special orders.
I work for Toys "R" Us. Will I lose my job?
Not during the restructure. Staff remain employed and keep their salaries and vacation time.