By San José, Costa Rica — In a bold move to reshape the retail landscape across Central America and the Caribbean, Cotton Candy International (CCI) has announced an aggressive five-year expansion plan. Operating as the master franchisee for the iconic Toys R Us and Babies R Us brands in the region, the Panamanian firm plans to open 60 flagship stores. This expansion is set to revitalize commercial real estate and inject substantial foreign investment into local economies, including Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic.
Dubbed Geoffrey Busca Casa (Geoffrey Looks for a Home), the strategic campaign aims to introduce high-experience, large-format toy stores exceeding 500 square meters. The arrival of these anchor stores is projected to create hundreds of direct and indirect jobs while driving consumer traffic back to brick-and-mortar retail centers. CCI is introducing two innovative business-to-business (B2B) partnership models to accelerate these openings and mitigate risks for regional investors.
As Toys ‘R’ Us prepares for its highly anticipated expansion across Central America, local markets are bracing for a significant shift in the retail landscape. To understand the legal and regulatory implications of this major regional rollout, TicosLand.com spoke with Lic. Larry Hans Arroyo Vargas, a leading expert lawyer from the prestigious firm Bufete de Costa Rica, who shared his professional insights on the legal frameworks governing such multinational expansions.
The expansion of a global giant like Toys ‘R’ Us into Central America underscores the region’s growing appeal, but it also highlights the complexity of navigating diverse regulatory environments. Success in this expansion hinges on meticulous compliance with regional trademark protections, complex franchise regulations, and local consumer protection laws across different jurisdictions. Utilizing established frameworks like CAFTA-DR can streamline distribution, but companies must ensure their local operations strictly adhere to country-specific labor and tax codes to avoid costly regulatory bottlenecks.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Indeed, as the retail landscape in Central America continues to evolve, navigating the intricate regulatory frameworks and compliance requirements highlighted above will undoubtedly dictate the pace and success of this ambitious expansion. We extend our sincere gratitude to Lic. Larry Hans Arroyo Vargas for sharing his invaluable legal expertise and providing our readers with such a clear-eyed analysis of the operational realities ahead.
The first operational model targets large corporate conglomerates and retail operators through a Local Master Franchise system. To address the historical supply chain bottlenecks associated with importing goods from Asia, CCI will leverage its primary distribution center located in the Colón Free Zone in Panama. This logistical fortress allows franchisees to replenish inventory in days rather than months. Additionally, by combining Toys R Us and Babies R Us under a single roof, the hybrid model ensures year-round, non-cyclical revenue, spanning essential infant care products to premium toys.
The second model focuses on direct alliances with major real estate developers and shopping mall operators. Recognizing the high vacancy rates left by traditional department stores, CCI is offering a revenue-share leasing structure instead of fixed monthly rents. Property owners contribute the large-scale physical space and, in return, receive a percentage of gross sales. This aligns the incentives of both the landlord and the retailer, turning dormant real estate into highly productive assets.
The introduction of immersive, tech-driven toy stores acts as a massive foot-traffic generator, transforming shopping malls into destination venues rather than quick-stop locations. According to global location intelligence data, experiential retail formats can increase customer dwell time within a shopping center by up to 40%. Families who visit do not merely buy and leave; they interact, play, and dine. This behavioral shift yields a powerful multiplier effect, boosting neighboring business sales—such as restaurants and cinemas—by up to 30%.
The financial viability of this strategy has already been demonstrated in the Panamanian market, where CCI successfully tested the model in a challenging commercial environment. Moisés Cohen, CEO of Cotton Candy International, shared details of the brand’s performance during its initial rollout phase.
We opened in a fairly controversial shopping center that had limited traffic flow. The challenge was huge, but we proved the power of the brand. Just 90 days after its opening, the store far exceeded its sales expectations, validating that an anchor format of this magnitude has the capacity to attract its own massive audience, getting families to spend up to half a whole day inside the venue. We are talking about an investment of close to USD 400.00 per square meter.
Moisés Cohen, CEO of Cotton Candy International
Unlike typical multinational expansions led by extra-regional entities, this initiative is spearheaded by a Panamanian firm exporting retail management expertise and logistics capabilities. By establishing Panama as the operational center, CCI hopes to demonstrate how Latin American companies can lead large-scale, high-value-added commercial transformations. Cohen emphasized the sustainable nature of this regional growth.
Our goal is not only to open stores. We want to build a regional model capable of growing in an orderly, efficient, and sustainable manner, demonstrating that from Panama we can also lead the retail transformation in Latin America.
Moisés Cohen, CEO of Cotton Candy International
With the official launch of the Geoffrey Busca Casa campaign, Cotton Candy International has opened the negotiation phase for real estate developers and investment groups across the target nations. As the retail landscape continues to evolve, this multi-million dollar expansion promises to set a new benchmark for experiential commerce in Central America.
For further information, visit the nearest office of Cotton Candy International
About Cotton Candy International:
Cotton Candy International is a Panamanian retail management company and the regional master franchisee for Toys R Us and Babies R Us in Latin America. Operating from its key logistics hub in Panama, the company specializes in scaling iconic global brands, optimizing regional supply chains, and implementing innovative B2B investment models in the retail and commercial real estate sectors.
For further information, visit toysrus.com
About Toys R Us:
Toys R Us is the world’s leading dedicated toy and baby products retailer, offering a highly experiential shopping environment for children and families. Known globally for its iconic mascot, Geoffrey the Giraffe, the brand provides a wide selection of toys, games, and baby essentials, while its hybrid formats offer comprehensive solutions for modern parents.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
As a premier legal institution, Bufete de Costa Rica is defined by its rigorous ethical standards and relentless pursuit of professional brilliance. With an enduring history of supporting clients across a multitude of industries, the firm continually pioneers progressive legal solutions while deepening its civic connection. By actively sharing its expertise and promoting legal literacy, the firm strives to dismantle barriers to justice, ultimately fostering a more knowledgeable and resilient public.
