Toys ‘R’ Us closes spin-offs, e-tail opens sport site

Citing a sizeable third-quarter loss, Toys ‘R’ US severed its unprofitable clothing arm, Kids ‘R’ Us and shut down its Imaginarium educational-toy stores in mid-November. Along with the stores, the three distribution centers servicing the 146 KRU and 36 Imaginarium sites will cease operating on or before Jan. 31, 2004. TRU posted a Q3 loss of US$38 million this year, US$10 million more than its US$28 million loss in Q3 2002. The move is expected to free up the toy-seller’s cashflow for 2004 as it attempts to contend with ever-increasing competition from mass-market retailers like Wal-Mart on the kid retail front.

Perhaps TRU’s new on-line venture will help. With the aim of becoming the number-one on-line retailer for children’s products, Toysrus.com has entered the sporting goods arena with Sportsrus.com. The site opened in October with an initial offering of 30,000 items covering fitness equipment, apparel and games. Parents looking to outfit their five- to 12-year-olds can head right to the ‘Just for Kids’ area; it includes sizing charts, buying guides with tips from experts and customer reviews. The e-tailing infrastructures for Toysrus.com and Sportsrus.com are managed by Amazon.

‘KB Toys at Sears’ expands

KB Toys and Sears have entered into a new agreement that will see ‘KB Toys at Sears’ in-store boutiques open in 600 Sears locations – that’s up 571 stores from the initial 29-store test run that launched in 2001. Each in-store operation will be open from mid-October to January, featuring a larger selection of My First Craftsman tool toys and activity kits developed by KB Toys.

Oakland, California to stop the big box

In late October, Oakland City Council voted 7-1 to approve legislation that caps the size of big-box stores being built within the city limits at 100,000 square feet. The measure stands in opposition to Wal-Mart’s plans to open 40 California Supercenters over the next four years. The average Wal-Mart Supercenter runs about 187,000 square feet and the company has opened 1,258 of them in 43 states – but none in California so far. According to Reuters news service, Oakland claims gigantic box stores will threaten smaller local retailers and depress wages.