Toys ‘R’ Us liquidation will have minimal impact on the holiday season: NPD
This is the first holiday season without Toys ‘R’ Us in about 70 years, and though some shoppers might feel a twinge of nostalgia there probably won’t be much of a business impact, according to NPD Group data. More than 70% of parents who purchased a toy from the retailer last year did so for Christmas or a birthday, the organization found. "Even without Toys ‘R’ Us, Christmas and birthdays aren’t going away, and kids will continue to ask their parents and grandparents for their favorite toy and get it," wrote Juli Lennett, NPD’s senior vice president and industry advisor for toys. Half of all toy purchases are made during the holidays and an NPD study shows that 83% of items purchased during the Toys ‘R’ Us liquidation were given away by the end of September. Lennett’s estimates show that the total negative impact of the Toys ‘R’ Us liquidation will be about 3.4% barring any unexpected news. "I think the Toys ‘R’ Us news has re-energized the toy industry," Lennett said. "Existing toy retailers are making bigger investments in toys, new toy retailers are emerging, and manufacturers are looking for new avenues of distribution." Stepping into the void are retailers like Walmart Inc. WMT, +0.49% Target Corp. TGT, +0.28% Amazon.com Inc. AMZN, +0.13% and even J.C. Penney Co Inc. JCP, +3.01% which have all talked up their toy offerings as the holiday season approaches. The SPDR S&P Retail ETF XRT, -0.76% is up 12.5% for the year to date, the Amplify Online Retail ETF has gained 26.3%, and the S&P 500 index SPX, +0.17% has gained 9.5% for 2018 so far.
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