As young couples looked for ways to waste time through last year’s pandemic lockdowns, Funtastic (ASX: FUN) has identified an opportune time to relaunch the Babies”R”Us brand which has not been seen in Australia for three years.
The relaunch comes after Funtastic secured Australian licences to operate the Toys”R”Us and Babies”R”Us brands in October 2020 from Tru Kids, the US-based brand owner.
While the brand will be relaunched, the initial rollout will be entirely digital via eCommerce channels instead of the brick-and-mortar model that collapsed in 2018 under the previous licence holders. Instead, the eCommerce strategy will draw upon Funtastic’s existing retail technology which has been selling toys online under Funtastic’s Hobby Warehouse and Toys”R”Us brands.
“The relaunch of Babies”R”Us is a significant milestone and important phase in the development of the Group,” said Funtastic CEO, Louis Mittoni.
“Advancements in Toys”R”Us’ performance and the expansion in our logistics capabilities are also vital accelerators for our innovative e-comm platforms, for which we are well funded to implement in coming months.”
Since re-launching Toys”R”Us, Funtastic delivered strong sales through the Christmas season with the Group reporting $30.1 million in sales for the Half-Year ending 31 December 2020, a 4% increase on the previous corresponding period.
To accommodate the increase in goods that are being sold by Toys”R”Us and Babies”R”Us, Funtastic has secured a new 5,500 square metre warehouse in Dandenong South, Victoria which will facilitate supply and delivery.
Once relaunched, Babies”R”Us will seek market share from industry leader Baby Bunting (ASX: BBN) which reported a 16.6% increase in sales for the December Half-Year to $217.3m
In separate news, Funtastic has confirmed it will not be renewing its distribution contact with Razor, best known as scooter manufacturers, bringing an end to an 18 year partnership where sales of Razor products represented 15% of Funtastic revenues in the December Half-Year result.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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