It looks like all those Finding Nemo glow-in-the-dark toys are going to be looking for a new home soon. The Walt Disney Co. announced that it will be closing more than 100 of its Disney Store outlets during the next six months. According to the Los Angeles Times, the executives of the Burbank-based entertainment giant will sell the remaining stores to one or more buyers that could operate them under a licensing agreement.
Founded in 1987, the Disney Stores have suffered from over-expansion, and although they brought a lot of visibility to the company products, they failed to respond quickly to changing consumer trends and a falloff in demand for merchandise featuring the animated movie characters. Disney recently reported that operating income in its consumer products plunged 38% to $53 million in its fiscal second quarter.
To prepare for the coming changes, Disney Store president Peter Whitford resigned from his post yesterday and was replaced temporarily by chief of Disney’s consumer products unit Andy Mooney. The company plans to reduce the number of stores in North America to less than 300 in the next six months. This move comes as no surprise to industry observers who noted that two years ago, AOL Time Warner also pulled out of its Warner Bros. stores and that specialty retailers have had a hard time surviving the tough market conditions.