For about two years, I ran a huge toy store in Connecticut. It was a magical place that sold everything from board games to models, doll houses, radio control vehicles, collectible card and miniature games, and much more.
Our core customer base was loyal. We had people who came in every weekend and regular game players who visited more than once a week.
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The store, Time Machine Hobby, in Manchester, CT, still exists (and thrives) but even in my time there, which was over a decade ago, we would see some disturbing customer trends. Sometimes, we would have people come in looking for a train set, a radio-controlled plane, or some other expensive item.
They would ask questions of our staff, look at the item, and otherwise do their homework in the store only to buy the item online at a lower prices. On some occasions, that would literally happen in front of us.
We would do all the work and a customer would jump on their phone to save a few dollars.
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Digital-only retailers have lower costs. They don't spend money on customer service and educating people about products.
Local brick-and-mortar chains, even when they also sell nationally over the web can be crushed by online discounters selling at lower markups.
Image source: Ben Hasty/MediaNews Group/Reading Eagle via Getty Images
Legacy Toys tried to bring back the classic toy store
While digital retailers have crushed the toy industry, the demise of brick-and-mortar chains like Toys R Us and KB Toys can be blamed partially on Walmart and Target. Those big box retailers use their toy aisles as a way to entice parents to bring their kids with them to shop.
Walmart and Target can make their money on groceries, home items, and clothes while using toys as a loss leader. They also get better prices on board games and many popular big brands because of their buying power.
Still, many markets have local toy stores and even toy store chains trying to bring back the classic toy store model. These are generally highly-interactive stores where staff engages with customers.
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One of those chains, Legacy Toys, had carved out a niche in the space.
“Legacy Toys is a locally owned Specialty Toy Store that started in Minnesota. The idea behind our toy store is all about helping kids explore anduse their imagination rather than grow up immersed in video games. We encourage creative play throughout our entire store and hope you'll join us as we educate and encourage creative play to future generations. It's our greatest legacy,” it shared on its website.
Legacy Toys declared Chapter 11 bankruptcy
A small, five store chain, Legacy Toys has filed for Chapter 11 bankruptcy protection in the District of Minnesota. The company operates from its principal location at Southdale Center in Edina, Minnesota and has four other brick-and-mortar locations as well as a website.
All appear to be operating as no mention of Chapter 11 bankruptcy appears on the Legacy Toys homepage.
“The company elected to proceed under Subchapter V of Chapter 11, which is designed for small business debtors. The petition shows assets of $500K-$1M against liabilities of $1M-$10M, with between 50-99 creditors. Major creditors include Bremer Bank with secured claims of approximately $480K, Shopify Inc. with secured claims of $197K, and various toy manufacturers including Spin Master, Mattel, Melissa & Doug, and other industry suppliers,” according to an RK Consultants post on X, the former Twitter.
May of the largest debts listed are to landlords including Simon Property Group and Miracle Mile LLC.
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The company, which launched in 2012, strives to be more than a toy store.
“Our mission at Legacy Toys is to help nurture future leaders, inventors and creative thinkers. We encourage all families to laugh, grow and play together because we know that making the world a better place for our children is the greatest legacy we can leave,” it shared on its website.
