Toys “R” Us Canada is rapidly downsizing as competition, e-commerce and rising costs reshape the country’s toy retail market, leaving only 40 stores nationwide.
Toys “R” Us Shrinks as Canada’s Retail Landscape Shifts
A Changing Shopping Experience
In Langley, B.C., families still wander the bright aisles of the remaining Toys “R” Us store, where children test out figurines and explore colourful displays. Parents say the space feels safe and familiar, but many note they often browse rather than buy — a reflection of how consumer behaviour is evolving.
A Retail Giant Under Pressure
Across Canada, the once-dominant chain is facing financial strain as discount retailers and e-commerce platforms outpace traditional toy stores. The company’s footprint has fallen from 103 stores to just 40, with several locations — including Burnaby, Richmond and Vancouver’s flagship Broadway store — closing in the past two years. Analysts say rising costs, competition from Walmart and Amazon, and shifting preferences toward digital entertainment have eroded the brand’s long-held advantage.
How the ‘Category Killer’ Rose to Power
When Toys “R” Us entered Canada in 1984, its massive standalone stores transformed the toy industry. Offering unmatched selection and scale, the chain outcompeted independent toy retailers and mall-based shops. Industry experts recall how the brand became a “category killer,” reshaping consumer expectations for toy shopping and contributing to the decline of long-standing chains such as Toys & Wheels.
Why the Market Shifted
By the early 2000s, digital disruption began erasing the company’s dominance. Video games, electronics, and emerging online marketplaces diverted teenagers and families to new forms of entertainment. Meanwhile, big-box rivals stocked toys year-round at lower prices, pushing specialty retailers into a margin battle they couldn’t win. Retail strategists say this combination of market fragmentation and aggressive competition marked the beginning of a long decline.
Operational Strains Behind Closures
As leases increased and retail spending softened, the financial model that supported 30,000-square-foot stores became unsustainable. Analysts note that many locations could only remain viable at a fraction of their original size. With fewer customers and growing operational costs, Toys “R” Us began selling real estate and exiting key urban markets. Several former sites — including Vancouver’s prominent Broadway address — are now primed for redevelopment under new municipal plans.
What Comes Next for Toy Retail
Experts say the shrinking chain doesn’t mean physical toy stores are obsolete. Demographic shifts, including younger families moving into suburbs like Langley, may preserve select locations. However, the future likely belongs to smaller, specialized retailers offering curated experiences rather than massive big-box formats. For communities losing their Toys “R” Us anchor stores, the challenge will be finding suitable replacements in an already strained commercial real estate market.
