With one week left until Christmas, customers can still find some of the season's hottest toys like Dora's Talking House and Bella Dancerella, a ballet kit, at Toys R Us. But it's a different...
NEW YORK With one week left until Christmas, customers can still find some of the season’s hottest toys like Dora’s Talking House and Bella Dancerella, a ballet kit, at Toys R Us. But it’s a different story at rival Wal-Mart, whose inventory of many of the popular items has been depleted, according to some analysts.
“We are in great stock with all the hot toys. … This is when we shine,” said Kathleen Waugh, a spokeswoman at the Wayne, N.J.-based retailer, which went back to its toy suppliers last month to reorder some of the surprise hits this season. They include Spin Master’s Aqua Doodle, a coloring mat with water-filled pens, and Mattel’s Fisher-Price’s Magic Hair Fairytale Dora, a 15-inch doll that comes with a butterfly wand.
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Wal-Mart spokeswoman Suzanne Haney disputed the contention that the store’s shelves were lacking, saying: “We still have a great selection of toys at every-day low prices.”
Toys R Us, the nation’s second-largest toy retailer behind Wal-Mart, has a lot at stake this toy season. Last year, discount giant Wal-Mart spoiled Toys R Us’ Christmas with earlier and heavier discounts than in the past. In August, Toys R Us, whose profits plunged more than 60 percent last year, said it was considering selling its toy business; how it fares this holiday season will be a big factor in its decision.
To help reverse its fortunes, this holiday season, Toys R Us stocked its shelves earlier than it did last year, has more exclusive merchandise, and has been beating the discounters on price at least in November. Over the last week, Toys R Us’s prices have been slightly higher than the discounters, as it doesn’t see the need to reduce prices on items that can no longer be found on its rivals’ shelves, according to analysts.
However, while Toys R Us has an advantage on selection, it is too soon to tell whether it will bring home a healthy quarter. Last year, Toys R Us wound up with a disappointing holiday season even though it still had the hot toys at the end of the season.
Sean McGowan, an analyst at Harris Nesbitt, an investment research firm, said that customer traffic will be the deciding factor in how Toys R Us fares this year, but he believes that this year “should be better.” He noted that this season customers have gotten the message that Toys R Us is competitive on price and has the toys that shoppers want.
The retailer is getting replenishments of the most popular toys every day until Dec. 24, Waugh noted.
So far, Toys R Us’s prediction of the hot toys has been on target. Other popular toys that are selling out but that the toy seller still has in stock are Hasbro’s Video Now Color, a portable video player, Vtech’s VTechV.Smile, an interactive learning system that plugs into the TV, and Fisher-Price’s ESPN game station.
McGowan said that based on last week’s spot check of 25 hot toys, Toys R Us was in stock on 68 percent of the items. That compared with 56 percent for Target and 48 percent for Wal-Mart.
“I am finding huge holes” at Wal-Mart, McGowan said. He noted that the discounter’s stock position is worse than a year ago.
Last month, Toys R Us was about 2 percent lower in price than Wal-Mart and 3 to 4 percent lower than at Target, based on McGowan’s spot check of 75 toys.
“Between now and next week is what it comes down to,” McGowan added.