KB Toys

» see kbtoys.com as it lived, on the wayback machine

~ the obituary ~

kb toys never reached turkey. the chain was an american mall fixture, the small bright box next to the orange julius with the discounted action figure bin and the wall of nerf you walked past on the way to the food court. by the time i was in any american airport in the 2010s the brand was already gone. my mental model of it is pieced together from forum threads and from sitcom set design.

harry and joseph kaufman opened a wholesale candy operation in pittsfield massachusetts in 1922 and called it kaufman brothers. wholesale toys came in 1946. the retail format started in the 1970s as kay-bee toy and hobby, in the strip malls and enclosed malls of the post-war american suburb. melville corporation bought the chain in 1981 and rolled it into a toy-store empire alongside heartland and toy works. consolidated stores took it over in 1996. by 1999 the kb-toys brand had grown to 1,324 stores across 44 states plus guam and puerto rico, with annual revenue around 1.6 billion. that put it behind toys r us and ahead of every other mall toy retailer in the country.

the format worked while the mall was the saturday-afternoon destination for american families. the smaller footprint compared to toys r us meant kb stocked impulse buys and licensed plastic from whatever movie was in season, with a clearance bin near the door. the mall lease portfolio kept rent high once foot traffic started to shift. bain capital bought the chain in december 2000 in a leveraged deal that left kb carrying the debt. that debt structure is what bain has been litigating about ever since.

the first chapter 11 came in january 2004 with around 300 million in debt and led to the closure of more than six hundred stores. kb emerged under bain control in august 2005 as a smaller operation. it ran for another three years. the second chapter 11 filing landed on december 11 2008 in the middle of the great-recession holiday season. the liquidation took eight weeks. final stores closed february 9 2009 and the kbtoys.com domain went dark with them. streambank llc sold the brand and intangibles to toys r us in september 2009 for about 2.1 million dollars, which is what a 1,324-store chain is worth as a trademark after the shelves are empty.

~ the case file ~

~ what it was ~

the kb format was about 3,000 to 5,000 square feet of densely-packed shelving inside the mall, lit harshly under fluorescent tubes, with a clearance table at the front and a register tucked at the back. the chain pioneered the deep-discount toy approach that walmart and target later perfected. its catalog leaned into licensed plastic from whatever movie or saturday-morning cartoon was in season, and into the closeout buys that let kb undercut toys r us on the secondary tier of every line.

the kbkids.com brand launched in 1999 as a separate consumer-internet entity in the bnsf-and-onsale dot-com wave. brainplay.com merged into it that year. it filed its own chapter 11 in january 2004 alongside the parent chain.

~ the bain leverage ~

the bain transaction in december 2000 was structured as a 305 million dollar leveraged buyout. the chain paid bain an 85 million dollar dividend within a few months of closing, a number that kb's later trustees argued was the leverage that destabilized the company before walmart and amazon arrived. mitt romney's 2012 presidential campaign was dogged by the kb deal as one of the case studies of bain-era private equity. the litigation around the dividend distribution settled in 2010 for around 13 million dollars, well under what the trustees had been seeking.

~ the long tail ~

the kbtoys brand reappeared briefly in 2018 when a relaunch was announced under e-commerce ownership, with pop-up stores planned for the holiday season. the pop-ups did open in late 2018 in a small footprint and ran briefly. the brand has been quiet since 2019. the saturday-afternoon mall toy run was already a memory by then, and the smaller stores that did the bulk of kb's business during its peak years had been gone for a decade.

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