It was 1948, and Charles Lazarus had a hunch. Newly returned from World War II, he knew he wanted to go into business, and he knew—long before the term “baby boom” was a common phrase—that his friends were about to start having lots of babies.
“Everyone I talked to said they were going to go home, get married, have children and live the American dream,” he told Entrepreneur in 2008. “I decided that I would open a store in my father’s bicycle-repair shop. But instead of selling bikes, I would sell cribs, carriages, strollers, high chairs—everything for the baby. My instincts told me the timing was right.”
Those instincts didn’t just help Lazarus capitalize on the baby boom: They helped originate Toys ‘R’ Us. Once a retail juggernaut, the store dominated the entire toy industry—and children’s imaginations—by driving its competitors out of existence.
Now, the retail giant has been forced into bankruptcy, the victim of a retail model it helped pioneer. In March 2017, the 70-year-old businessannounced that it would call it quits. It was the end of an era for the store that once held a lock on the entire toy industry and made toy shopping—once a seasonal treat—into a regular family outing.
Lazarus opened his first store, Children’s Bargain Town, in Washington, D.C. in 1948. Specializing in baby goods, it only began selling toys once Lazarus realized customers didn’t come back for more strollers, high chairs and other baby goods with their second child. He started selling a few inexpensive toys, then added to his inventory as they proved popular.
But Lazarus wasn’t content to stop with a single store. He had an idea that was bigger than Children’s Bargain Town or any kids’ store he had ever seen—a massive store filled with every toy in existence. In 1957, he got out of the baby furniture business, renamed his company Toys ‘R’ Us and created the first ever big-box toy store.
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The new megastore took a supermarket-style approach to toy selling, which distinguished it from every other toy store in existence. Most toy stores were small and family-run, and only carried a limited line of products. Lazarus’ stores, on the other hand, were orders of magnitude larger than their competitors, and presented a smorgasbord of thousands of different toys.
Big-box stores like Toys ‘R’ Us astonished the era’s consumers, who had simply never seen stores that big and crammed with merchandise. “What Lazarus really captured was this sense of American abundance after the war and after all those years of depression,” says Richard Gottlieb, founder of Global Toy Experts and an authority on the toy business.
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1970s Toys R Us ad, still associated with the Children’s Bargain Town name.
Rusty Blazenhoff/Flickr Creative Commons/CC BY-NC 2.0
Gottlieb sees Lazarus as part of a bigger wave of entrepreneurship that took hold in the post-war years. “The modern American toy industry was really created by Jewish soldiers coming back from the war,” he says. Other Jewish industry superstars include Isaac Heller, who converted military surplus into toys for boys in the 1950s, Elliot Handler, the founder of Mattel, and Milton Levine, creator of the wildly popular “Milton’s Ant Farm,” which was a hit with kids during the 1950s and 1960s.
Lazarus’ idea was deceptively simple: build a supermarket for toys. While other toy shops had display cases and decorative interiors, Toys ‘R’ Us had concrete or tile flooring (better for the bottom line) and rows of toys laid out next to each other, grocery store-style. The store’s bare-bones appearance didn’t seem to matter to consumers, who were entranced by the toys within.