Toys 'R' Us re-enters India, will offer global brands before year-end

Is working on omnichannel model, will have smaller stores here than abroad; will also sell toys made in India by global players by the end of Calendar 2023

Toys ‘R’ Us has made its second entry into India by opening its first store in Hyderabad on March 11 as the firm 

looks to tap the country’s $1.5-billion toy market, more than 90 per cent of which remains unorganised.

The toy retailer is thus in competition with Hamleys, which belongs to the Reliance Industries’ bailiwick.

The US-based retailer is working with an omnichannel approach and will have small stores compared to what it has elsewhere in the world.

It will sell toys on its online store toyrus.in and will also sell them on e-commerce platforms Flipkart and Myntra.

Its Indian licensee is an equal joint venture between Ace Turtle and Flipkart.

Toys ‘R’ Us came to India with a different licensee partner just before the pandemic and had opened 10-12 stores, which it had to shut down due to lockdown.

In India, Toys ‘R’ Us will have 75 stores over the next three years and the store size in India will be 5,000-15,000 square feet, unlike elsewhere in the world where it is 50,000-75,000 square feet. It has set up dark stores, which will cater to its online demand, because it expects 70 per cent of its revenue to come from e-commerce.

The average selling price of the toys will be around Rs 1,000, but the retailer intends to have a range that will go up to Rs 25,000 and they will be manufactured in the country.

Indian brands too will sell toys through the US-based retailer.

The retailer will sell apparel, but its contribution to sales will be 10 per cent. But this is higher than in its other markets, where toys make up almost 95 per cent of sales. “India (stores) are getting smaller, but there is a difference between the India launches and the rest of the world. In other markets, Toys ‘R’ Us are all brick-and-mortar and then they started to go online and are now trying to go omni-channel. We are launching with an omnichannel approach,” Nitin Chhabra chief executive officer, Ace Turtle, told Business Standard.

Chhabra said its private-label toys were being manufactured in India and in the second phase, global toy brands not owned by the retailer would enter the Indian market. The second phase of its entry will come into effect before the end of 2023.

Due to the mandate of getting certification from the Bureau of Indian Standards, global brands selling their toys at its stores will commence in the second phase. “Our contracts with international toy brands are taking a bit longer because manufacturing will be done in India,” Chhabra said. Global toy brands will manufacture in India. Ace Turtle will get the know-how and designs from the global brands.

The game plan
 

ToysRUs to open 75 stores in three years

It expects 70 per cent of its revenue coming from online sales

Its store size in India will be in the range of 5,000-15,000 sq ft, compared with 50,000-75,000 sq ft globally

Global toy brands will sell through ToysRUs before the end of Calendar 2023