In 1999, the company operated 1,324 stores in the us and was the second largest toy retailer in the us. , But it later filed for bankruptcy in 2004 and 2008 before going out of business on february 9, 2009. At the time of closing, the company had 461 stores. International retailer toys "r" us acquired the remains of k·b toys, consisting primarily of its website, trademarks, and intellectual property rights. Strategic marks, a company that buys and revives defunct brands, acquired the brand in 2016 and planned to open new stores under the name starting in 2019; plans for this revival, however, failed due to lack of funding.
1 history 1.1 change of ownership1.2 bankruptcies and closures1.3 failed revival
Brothers harry and joseph kaufman originally opened the kaufman brothers sweets wholesale store in pittsfield, massachusetts on april 1, 1922.[1][3][4] in the 1940s, the brothers purchased a wholesale toy company from a candy buyer who owed them money for outstanding debts. On september 21, 1946, kaufman brothers opened a wholesale toy store at 70 columbus avenue in pittsfield, marking the company's entry into the wholesale toy market. In 1948 kaufman brothers inc. Ceased its involvement in the confectionery business in order to focus entirely on the toy business, which by then was flourishing.[5][4]
Mall known as kay-bee toy & hobby, and kay-bee is named after the initials in the kaufman brothers. At that time, the company had 26 stores.[5][8] in 1977, the company's name changed to kay-bee toy and hobby shops inc. By 1979, the company was based in lee, massachusetts. During the year, the company opened 40 new stores and claimed to be the fastest growing toy store chain in the country, with 170 locations in the midwest and east.[10]
Ownership change. [Edit]
In 1981, melville corporation acquired the company from the kaufman family for $64.2 million.[11][12] at the time, the company had 210 stores.[5] richard kaufman, son of harry kaufman [3], retired the same year as the company's president. [5] donald kaufman, richard's brother, was also a former vice president of the company.[3] in 1983, bankrupt california-based wickes sold 37 of its 45 toy world stores for $5.5 million to kay-bee toy & hobby, who took over the lease on the acquired stores. Since 1990, the company has advertised itself as "mall toy store". That same year, melville corporation acquired 330 circus world stores in 32 states for $95 million; the locations became part of the kay-bee division. In 1991, kay-bee toys acquired 136 k&k toys stores located in 18 states; the stores were converted to kay-bee stores the following year. During 1993 and 1994, as part of a major restructuring plan, kay-bee closed approximately 250 inefficient stores.[5]
The company became a direct competitor to toys "r" us in 1994 when the company expanded its malls and began opening stores known as kb toy works,[5] which operated malls and sold current and clearance toys.[19] kb toy works stores were larger than regular kb toy stores, [20] with an average area of 3,500 sq. Feet (330 m2) [19]. In addition, the company operated kb toy outlet stores, also known as kb toy liquidators;[19][21] these stores were located in shopping malls and sold toys on sale. During the holiday seasons, kb toys operated temporary stores in malls known as kb toy express.[19][22]
In 1996, kay-bee's sales were sold in the same year consolidated stores corporation for $315 million. The company's sales reached $1.6 billion in 1998, the same year that its merchandise website was launched. In the same year, the store's logo was changed to "kb". As of may 1999, kb toys had 1,324 stores. That same month, consolidated stores announced a deal with brainplay.Com (which provided information on toy sales) [26] to manage kbtoys.Com. As part of the deal, consolidated stores will invest $80 million and own 80 percent of the new website, while brainplay will own the rest. Kb toys, which will compete with the toys "r" us website and etoys.Com. The kb toys website was updated and relaunched in july 1999 as kbkids.Com. At the time, kb toys was the second largest toy retailer in the us. To expand kbkids' online presence, consolidated stores entered into a partnership with aol that was visible to 17 million potential customers online. By agreement, aol will provide links to the kbkids website. In september 1999, consolidated stores announced plans to sell 20 percent of kbkids through stock in an upcoming public offering. In october 1999, kbkids.Com launched a $43 million advertising campaign, including tv ads, to promote the site in advance of the holiday shopping season.
In january 2000, consolidated stores filed with the us securities and exchange commission to list kbkids on the nasdaq as a separate publicly traded company with the ticker "kbkd". The initial public offering was valued at $210 million. Consolidated stores was unable to generate significant revenue from kb toys[34] and suffered financial losses in 1999 and 2000[35][36] partly caused by spending on kbkids.Com;[36] another factor was the decline in video game sales at the kb location toys.[35] in june 2000, consolidated stores abandoned its plans to take kbkids public[33] and announced plans to sell kb toys.[34]
In december 2000, bain capital acquired the company . For $305 million in partnership with the kb toys management team. The investment group included 200 store managers led by bain capital and kb toys ceo michael glaser. Bain capital contributed $18.1 million to the sale, with the remainder funded by banks that loaned the money to kb toys. Kb's toy sales included various divisions: kb toy works, kb toy outlet, kb toy liquidators, kb toy express, and kbkids.Com. The sale ended two decades of the kb toys subsidiary, turning it into a private company. Kb toys began to focus more on video games, which accounted for 20 percent of the company's revenue as of 2001. Beginning that year, kb toys opened temporary "stores within a store" at select sears department stores during the christmas season. The stores were originally known as "kb toys at sears" and had an average floor area of 1,500 sq. Feet (140 m2). In 2001, kb toys agreed to pay about $5.4 million to acquire several lots from bankrupt etoys. In april 2002, as a result of a dividend recapitalization, bain capital received an $85 million payment from kb toys, which funded the payment with $66 million in bank loans. Glazer received $18 million, with $16 million divided among other executives. Kb toys faced stiff competition during the 2003 christmas season, in addition to expensive mall store leases, which resulted in lower customer footfall. Approximately 950 of the company's 1,217 stores were located in malls.[47] with $300 million in debt, [11] kb toys filed for chapter 11 bankruptcy protection in january 2004 and subsequently closed over 600 stores, resulting in the layoffs of over 3,400 of the company's 13,000 employees. ] Lenders said a 2002 dividend deal with bain capital left kb toys insolvent, resulting in a $109 million loss, leading to bankruptcy filing. Bain capital stated that kb toys was in financial health at the time of the dividend deal and that the company's financial problems were later unrelated to the deal. , Kb toys' creditors, including hasbro and lego, have accused the company's top executives and majority shareholders of improperly securing themselves multimillion-dollar payments prior to bankruptcy. Lenders, referring to the april 2002 deal, argued that the payments occurred during a downturn in the economy and kb toys' business and that the payments had a "devastating effect" on the company. That same month, big lots (formerly consolidated stores) filed a lawsuit against bain capital claiming it was owed $45 million for the 2000 sale. The big lots lawsuit was dismissed in 2006. 51 [52] [53] [54] bain capital attempted to retain control of kb toys, which was instead handed over to prentice capital by a bankruptcy judge.As part of the new bankruptcy plan, prentice capital invested $20 million in kb toys. Gregory r. Staley, former president of the american and international divisions of toys "r" us, was named the new ceo of kb toys. The company had 640 stores. In august 2007, the company announced a business strategy that included layoffs at its pittsfield, massachusetts headquarters. In november of the same year, the company had 566 stores and began to close 122 of them.[5][54]
Due to poor sales in malls as well as competition, the company filed a lawsuit . Filed for chapter 11 bankruptcy on december 11, 2008. [5] [56] that same month, the chain began halting sales. At that time, the company employed 10,850 employees, including about 6,500 seasonal workers.[5] the company operated 277 malls, 114 toy outlet stores, 40 toy works stores, and 30 toys holiday stores for a total of 461 stores. At the time, it was the largest mall toy retailer in the united states, operating in 44 states plus guam and puerto rico. He was also the second oldest active toy retailer in north america (after fao schwarz) until his passing. [Edit] the store closing sales (as well as the closing of the company's website) ended on february 9, 2009. [57]
The k·b toys brand and related intangible assets were sold to streambank llc to toys "r" us on september 4, 2009 for $2.1 million. Since the k·b toys stores were closed and liquidated, the sale was limited to the company's logo, website, trademarks, and other intellectual property. Toys "r" us initially didn't know how to integrate the k·b name into their business plan.[2] toys "r" us used the name k b toys on their own made toys called "kb classics" with the k b toys logo. >
Strategic marks, llc,[59] a company that buys and revives defunct brands, registered a trademark for kb toys in 2016 after toys "r" us allowed a previous registration to expire.[15] in march 2018, strategic marks founder ellia kassoff stated that due to toys "r" us ceasing operations in the united states, strategic marks planned to open 1000kb toy pop-up stores across america by black friday (november 2018 .). [ 60 [59] after the holiday season, kassoff decided which stores would become permanent. In early november 2018, kasoff announced that the relaunch would be delayed until 2019, allowing the company to start with "as few bugs as possible". Kasoff said the delay "will give us enough time to build the most optimal supply chain, distribution and retail infrastructure that our customers deserve." Before the delay, it was planned to open 400 to 600 seasonal pop-up stores in 2018 and 600 to 800 permanent stores within three to four years.[61]
In march 2019. Kasoff cited a lack of funding as the reason the pop-up stores did not open as planned. He stated, “toy companies have had many conflicts of interest that have prevented them from investing in kb given that they sell to other retailers and mall operators do not typically invest in potential tenants. Strategize. As soon as we raise the money, we will get to work.” Strategic marks was looking for an investment bank to finance the opening of 200 to 250 temporary kb toy stores, which would determine the viability of permanent stores. As of 2022, the revival has yet to take place.
Litigation[edit]
In december 1999, the equal rights center (terc) and two black clients filed a federal lawsuit against kb toys over one of the company's policies that personal checks could not be used to pay for purchases at certain stores that were experiencing an unusually high number of returned checks. Terc argued that kb toys' policy was discriminatory against blacks, stating that the policy was enforced at eight stores in predominantly black neighborhoods located in the baltimore-washington metropolitan area. Kb toys denied the allegations and said that racial demographics were not considered in the policy's adoption 13 years ago. The company went on to say that checks from whites were also not accepted at the stores named in the lawsuit.[63] by march 2000, the lawsuit had been amended to include three more black plaintiffs, and the lawsuit sought damages as well as an end to the company's check-writing policy. In january 2001, a u.S. District judge struck terc out of the case because it was not affected by kb toys' check-writing policy. The litigation continued into 2003.The case was settled in august 2003 for $1.2 million. In 2003, a class action lawsuit was filed in chicago against kb toys alleging that the company's stores used misleading price tags to manipulate consumers into believing they were buying discounted merchandise. The lawsuit was settled with kb toys, which provided a weekly 30% discount on purchases of $30 or more. Financing the universe. Retrieved november 18, 2016 ^ a b pereira, joseph; john kell (september 4, 2009). "Toys 'r' us buys kb toys brand". Wall street journal. Dow jones and company. Retrieved january 09, 2016 ^ a b c smith, jenn (october 15, 2005). "Former kb toys owner dies". Berkshire eagle. Archived from the original on march 6, 2015. Retrieved december 3, 2014. ^ A b "local toy company celebrates 30th anniversary." Berkshire eagle. April 1, 1952. Retrieved october 9, 2018 – via newspapers.Com. ^ A b c d e f g h i j k l m n o p vanden berghe, darren (december 12, 2008). "Mass layoffs in kb". Berkshire eagle. Retrieved may 15, 2018. ^ "For the kids". Berkshire eagle. 1946-09-21. Retrieved october 9, 2018 – via newspapers.Com. ^ "Kaufmans enter wholesale toy business". Berkshire eagle. 1946-09-21. Retrieved october 9, 2018 – from newspapers.Com. ^ "Kay-bee toys packs 3000 items". Advertiser montgomery. 1992-09-24. Retrieved october 12, 2018 - from newspapers.Com. ^ "What's new in mews". Berkshire eagle. 1977-11-18. Retrieved october 9, 2018 – via newspapers.Com. ^ "Kay bee hobby toy store adds 40th store of the year". Bulletin-palladium. 1979-10-23. Retrieved october 9, 2018 – via newspapers.Com. ^ A b c d fanto, clarence (october 28, 2012). "Bain capital's role in kb toys' decline still a matter of controversy". Berkshire eagle. Retrieved october 12, 2018. ^ "Melville buys kb". Asbury park press. July 15, 1981. 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Retrieved october 11, 2018. ^ "New riverview west toy store feature". Orange county register. August 13, 1998. Retrieved october 11, 2018 – via newslibrary. Kb toy works opened at the riverview west shopping center on mcfadden avenue. Kb toy works is an enlarged version of kb toys.^ A b "the end of kb toys sales." Business journals. 2000-12-08. Retrieved october 11, 2018. ^ Boardman, tanya (april 06, 1998). "Black marlin caught by fan of isaac hunter". Business magazine "triangle". Retrieved october 11, 2018. ^ "Kay-bee toys bought for $315 million". Los angeles times. 1996-03-26. Retrieved october 10, 2018. ^ A b "kbtoys makes a deal online." Cnnfn. May 19, 1999. Retrieved october 10, 2018. ^ A b scherer, paul m.; Pereira, joseph (may 19, 1999). "Consolidated stores to merge kbtoys.Com with brainplay.Com". Wall street magazine. Retrieved october 10, 2018. ^ Cuneo, alice z. (June 21, 1999). "Kbtoys set to lure goldberg moser for $40m: online review continues as toy retailer prepares to take battle online ". Advertising age. Retrieved october 12, 2018. ^ "Kbkids.Com takes a step forward, consolidated toy site opens today". Columbus dispatch. 1999-07-21. Retrieved october 10, 2018 - via newslibrary. ^ Sturgeon, jeff (july 22, 1999) "roanoke county, virginia online store toy supply firm" knight ridder/tribune business news archived from the original on october 11, 2018. Retrieved october 9, 2018 - via highbeam.^ "Kbkids.Com strikes deal with aol" columbus dispatch september 10, 1999. Retrieved october 10, 2018 - via newslibrary. ^ "Kbkids.Com's consolidated plans offer". Dispatch columbus 1999-09-29 retrieved october 10, 2018 – via newslibrary. ^ "Toy vendor to promote website". Denver post. 1999-10-07. Retrieved october 10, 2018. ^ "Kbkids.Com goes public". Cnnfn. January 27, 2000. Retrieved october 10, 2018. ^ A b "kbkids.Com, zebu ax ipo". Cnnfn. 2000-06-13. 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