Toys R Us Expansion Hits Payment Snag With Wary Suppliers

Toys “R” Us is staging an aggressive comeback with plans to open 120 new stores by Thanksgiving, but the toy industry’s collective memory of the retailer’s catastrophic 2017 collapse is making suppliers nervous about extending credit.

Go! Retail Group, which operates the stores under license from brand owner WHP Global, is asking vendors to wait up to 180 days for payment after delivering goods. That’s double or triple the industry standard of 30 to 90 days. For a toy industry still bearing scars from losses totaling millions when Toys “R” Us filed for bankruptcy in 2017 and liquidated in 2018, these terms feel like asking them to relive a nightmare.

The Trust Problem

Jay Foreman, CEO of Basic Fun (maker of Tonka Trucks and Care Bears), was blunt about the situation: “They should be the ones financing the business, not their vendors.” His frustration captures the real issue here. Extended payment terms essentially force suppliers to become unwilling financiers of the retailer’s expansion, absorbing the risk if things go wrong again.

Interestingly, Go! Retail CEO Gideon Schlessinger claims the company hasn’t seen hesitation from suppliers. Either the toy makers are keeping quiet publicly while negotiating privately, or some are indeed willing to take the gamble. Given the industry’s institutional memory, though, it seems more likely that suppliers are approaching these negotiations with extreme caution.

Why This Comeback Could Actually Work

The revival isn’t entirely built on nostalgia. The brand is banking on a significant market shift: adult shoppers now account for 55% of toy sales. That’s a massive demographic that didn’t exist in the same proportion when Toys “R” Us first collapsed. U.S. toy sales grew 17% in the first half of 2026, marking the biggest jump in six years, so there’s real growth to tap into.

Most of the new 120 stores will be temporary mall locations, which is a smarter real estate strategy than the massive standalone stores that contributed to overhead burdens during the first run. This indicates management has learned from past mistakes.

The Real Test

The expansion plans would bring Toys “R” Us to 160 standalone U.S. stores total. On paper, this looks reasonable. In practice, success depends entirely on execution and sales velocity. If holiday shopping disappoints, suppliers stuck with 180-day payment terms could find themselves in another painful situation.

The business of retail expansion has always been about momentum and cash flow. When Toys “R” Us asks for extended payment terms, it’s essentially saying: trust us with your inventory and your capital for six months. After 2017, that’s not a casual ask.

What’s fascinating is that toy companies are even considering it. The market opportunity is clearly compelling enough to outweigh the risk for some vendors, even if others are holding firm on traditional terms. This could create a competitive advantage for willing suppliers who get prime shelf positioning in the new stores.

The toy industry has moved faster than many retail sectors in adapting to e-commerce competition and changing consumer behavior. But when it comes to extending payment terms to a resurrected retailer with a troubled history, vendors are being careful. They’re weighing opportunity against institutional trauma, and that calculation will define whether this comeback is genuine or just another tower waiting to topple.

Source: New York Post