What Happened to KB Toys?

KB Toys (often styled Kay-Bee Toys) grew from a small New England business into one of the most recognizable mall-based toy chains in the United States. By the 1980s–1990s it was a fixture of enclosed malls and outlet centers, famous for wall-to-wall peg hooks, overstock bargains, and the red clearance bins that drew kids on weekend outings. The company leaned heavily on fourth-quarter sales—Black Friday through Christmas—supplemented by catalogs and seasonal kiosks that expanded footprint during peak demand.

The retail landscape shifted, however. Big-box competitors and e-commerce squeezed margins, while the decline of many regional malls reduced casual foot traffic. Toy retail also carries inventory risk: fads turn quickly, movie tie-ins are cyclical, and recalls can be costly. After a Chapter 11 restructuring in 2004, KB Toys emerged smaller but still seasonal-dependent. The 2008 financial crisis sharply curtailed holiday spending; the chain filed for bankruptcy again that December and began going-out-of-business sales, with most stores closing in 2009.

Since then, the KB Toys name has resurfaced periodically online or in proposed popup concepts, a testament to its strong nostalgia factor among shoppers who remember spontaneous mall stops, aisle endcaps piled with action figures, and last-minute stocking stuffers grabbed en route to the food court.