Toys “R” Us Inc. executives recently outlined a four-point strategy, entitled TRU Transformation, intended to improve the company’s operational performance. At presentations for investors, industry analysts, and the media this past Wednesday, Toys “R” Us chairman of the board and chief executive officer Antonio Urcelay and president Hank Mullany discussed priorities and actions intended to slow the company’s sales decline, stabilize cash flow, and improve EBITDA to effectively position the company to grow revenue and profits next year and beyond.
“As we look to the future, our strategy will establish a path to sustainable business growth, building upon the company’s unique strengths,” Urcelay said.
TRU Transformation will focus on four key priorities:
- Transform the shopping experience in-store and online. The company has already begun to implement initiatives, such as cleaning up existing stores and improving in-store execution; improving out-of-stocks and speed of checkout; solidifying customer relationships through strengthened loyalty and targeted marketing; improving price perception by developing a clear pricing strategy and simplifying promotional offers; and optimizing the e-commerce experience.
- Collaborate with business partners to drive differentiation, innovation, and value. Toys “R” Us will leverage business partner relationships in the U.S. and abroad to drive category leadership and effective differentiation in products, events, and services, and to create in-store excitement.
- Develop high-performing, highly engaged, diverse talent. Internal priorities will include reviewing the organizational structure, creating an infrastructure that promotes talent development, maintaining a culture of productivity and accountability, driving training in areas that matter most for customers, cultivating a culture of engagement, and enhancing the ability to hire and retain great talent.
- Become fit for growth. The company will focus on improving operational and financial performance, while positioning the business to capitalize on future growth opportunities through the implementation of a right-sized cost structure, a strong focus on disciplined inventory management, and the deployment of capital to key growth initiatives.
As part of a renewed assessment of its operations and business structure, a number of opportunities were identified to streamline functions and reduce headcount.