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The CEO of Toys 'R' Us Already Knows What This Year's Hottest Toy Will Be

July 24, 2016 00:00 AM UTC
- Updated April 29, 2020 17:47 PM UTC

David Brandon predicts the company’s holiday success.

Transcript
Let's talk a little bit about going public. In your two previous jobs as CEO, you turned around private companies. You took them public, and you have a very successful track record. So the big question is, what's your timetable for taking Toys R Us public? Yes, I have experience doing that. Yes, that's a distinct possibility at some point for this company. There has to be a monitization event at some point in the future. I know how to do that. But right now for us as an organization, to get focused on that tomorrow would detract from what we're trying to accomplish today. Do you have some kind of list that you're checking off, saying, we have to achieve this milestone or that milestone before we can go public? Not really. So my message to our folks is, let's establish positive trend lines, consistent trend lines. Let's make sure all of our regions of the world are performing at the highest level. Because doing a public offering is really not what it's all about. It's maximizing value at the public offering. And I remind people when they want to talk about this that doing an IPO is not the end of the journey, it's the start of a journey. You are entering a much more competitive, much more difficult, challenging world in terms of results and accountability. And so we want to make sure we're ready for that. I'm sure you're already gearing up for the holiday season. It's an important retail event for your company. What is the key thing that you're doing to take on the competition? The key thing that we have to do is, first of all, recognize we're in a fashion business. The products that we sell oftentimes have built in obsolescence. There are shortages. There's allocations. And as the world's largest toy retailer, we really need to get our fair share of those allocations of those hot toys that we know we're going to be in high demand. Do you know what the hot toy is going to be for 2016? We have a pretty good sense for it. Can you tell us what it is? No. Not yet. Are you going to have enough inventory so that people are not standing in long lines? That's our job. We have very experienced merchants. We have merchant teams have been doing this for decades. We're a 65-year-old company. We have a lot of institutional memory and experience that helps us, number one, identify when a toy is going to be a hot toy. And then, we have vendor relationships that afford us the ability to really try to get a commanding share of that toy. What's your prediction of the holiday shopping season? Do you think it's going to be a strong season, and how are you going to do? All the forecasts lead me to believe, and the innovation that I've seen in the toy category, leads me to believe that we're going to see another growth year on top of a pretty strong growth through last year. So we think that the category could be anywhere from 3% to 5% positive on top of 6% or 7% last year.