By the time Toys R Us earlier today sought bankruptcy court approval “to begin the process of conducting an orderly wind-down of its U.S. business and liquidation of inventory in all 735 of the Company’s U.S. stores,” many of those in the licensing business were well into the process of trying to figure out how they’re going to conduct business without the retailer who has been best able to launch and nurture new properties and products. (It should be noted that some have floated “white knight” scenarios that would keep as many as a third of the company’s stores operating.)

As one of the last toy specialty chains, Toys R Us, which filed for Chapter 11 protection last September, has been a showcase for new and emerging brands. Two notable examples in recent years: it championed the U.S. launch of Shopkins in the middle of this decade, and launched the toy line for Daniel Tiger’s Neighborhood soon after the series began airing in 2013.

“For the great brands that aren’t owned by Disney or Nickelodeon, the road began at Toys R Us or ran through it,” says The Licensing Street’s JJ Ahearn, whose firm represents such children’s properties as Daniel Tiger, Octonauts and Dinosaur Train. “It will be interesting to see how that impacts the industry.”

One children’s producer said that TRU has given properties a chance to breathe and develop a following. “You used to be able to have singles” in specialty that could “grow into doubles and triples.” That will be tougher now, she said.

Many companies have been revising product plans in the past 10 days as reports emerged of TRU’s pending demise. One licensee said he’s scaled back his licensed toy line that had been slated to be sold through Toys R Us in 2019.

It’s expected that mass market behemoths Walamrt and Target will pick up a piece of the $11 billion in revenue that TRU had generated. Of course, the growing eCommerce retailers, led by Amazon and its marketplace, will grab a share of the business, and it’s expected that channels such as dollar stores, supermarket/ drug and specialists such as Barnes & Noble and Party City could broaden their assortments. Many executives with whom we spoke also believe that this could lead to a resurgence in toy specialty stores.

Ironically, one name that pops up in several conversations about potential toy specialty winners is FAO Schwarz, which ThreeSixty Group purchased from Toys R Us in 2015. An FAO flagship is slated to open in New York’s Rockefeller Center this fall, and the company recently announced plans to open several airport locations via The Hudson Group.

“If you are a Paw Patrol, you will pick up the lost sales [somewhere else], but it’s emerging properties — brands seeking to test the waters and DTRs” — that are going to face the biggest challenges, says The Joester Loria Group’s Debra Joester.

One agent said that Target, which has shown more of a willingness than Walmart to take a chance on a new property (such as Beat Bugs last year), has quickly moved from being “one of the prom queen’s court to becoming the queen herself” among smaller properties hoping to get the chance to make a big impact.

Another question hanging over the bankruptcy is the status of any direct-to-retail (DTR) license agreements that TRU has. Though agreements commonly include language that would nullify an agreement if one of the parties goes bankrupt, it’s been doubted by some attorney whether that could be enforced, since the court could consider the license itself to be an asset. TRU is known to have several DTRs, among them a long-running deal for Animal Planet (owned by Discovery) plush.

Also likely to suffer is new and emerging brands’ ability to secure broad toy licensing deals, given that Toy R Us provided instant scale that made manufacturing financially practical, says Ahearn. Instead, he says, smaller brands may have to start in plush or other less costly products, and gradually build a wider program, says Ahearn.

“We may go through this period where a retailer might not be able to give you enough scale” to justify a master toy program for a new TV series unless it proves to be an immediate hit, says Ahearn.

Even if more of the business shifts to ecommerce, it may lack a critical component without Toys R Us, says Omar Gonzalez, a toy designer at Kids II, which sells infant toys under Disney and Baby Einstein brands.

“It is a huge hit to the industry and it will be interesting to see how the market shifts and adapts,” says Gonzalez. “Online shopping doesn’t satisfy the unique need to play with a toy in person,” so merchants will be searching for a profitable brick-and-mortar formula.