Why was carrying so much debt a problem for Toys ‘R’ Us?
1 answer
Carrying a high amount of debt was a problem for Toys ‘R’ Us because it put a significant strain on the company's financial health. The interest payments on the debt were eating into the company's profits, making it difficult for Toys ‘R’ Us to invest in its stores, products, and operations. Additionally, as the retail landscape changed with the rise of e-commerce and changing consumer preferences, Toys ‘R’ Us was unable to adapt and compete effectively, further exacerbating its financial difficulties. The burden of debt ultimately led to the company filing for bankruptcy in 2017 and eventually liquidating its assets in 2018.