Toys R Us Could Be Going Bust TOMORROW- How Could This Affect You?
- Needs to pay £15 million VAT bill
- Faced bankruptcy several times in recent months
- Over 3,000 employees could lose their jobs
Struggling retailer Toys R Us could be going into administration as early as tomorrow, as it needs to find £15 million to pay for its VAT bill.
The toy retailer is trying to find a buyer ahead of the deadline for the bill, as poor sales over Christmas has left it short on cash.
It has previously been saved after agreeing to go ahead with a planned company voluntary agreement, which would see a quarter of shops shut and less job loss.
It was hoped that this deal would allow Toys R Us to pay off it.
The stores that are shutting have been holding closing down sales, and these have continued online.
At the time, Steve Knights, managing director of Toys R Us UK, said, “Like many UK retailers in today’s market environment, we need to transform our business so that we have a platform that can better meet customer’s evolving needs.”
It was planning on turning the locations staying open into smaller interactive stores, in an attempt to modernise the brand, but the poor Christmas sales have hindered this.
It claims its’ warehouse style stores that opened in the 1980s and 1990s are now too big and expensive to run in the current retail environment, which is the cause of the brand’s struggles.
Sources have told Sky News that the directors of the retailer are likely to appoint administrators in the coming days, putting 3,200 jobs at risk.
Toys R Us has been unclear about what would happen to employees if it does close down.
What does this mean for you?
If you have a Toys R Us voucher, you should spend it as soon as possible, as if the company closes down then it will be worthless.
Similarly, if you are intending to take an item back to get a refund, then also do this as soon as you can.
While a company is still trading, it should continue to honour your return rights, but this cannot be guaranteed once it goes into administration.
If the company does close down before you can get a refund, then if you’ve paid by credit card 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 with a debit card, then you may be able to get the money back from your bank by using Chargeback, but this will depend on the bank you use.
Do you think Toys R Us should shut down? Let us know your thoughts.