Wal-Mart Takes Lead in U.S. Toy Sales

Wal-Mart Stores Inc. was the nation’s biggest toy retailer in 1998, dethroning Toys R Us Inc. for the first time in more than a decade, analysts said. Wal-Mart’s sales accounted for 17.4% of the market in 1998, while Toys R Us held a 16.8% share, according to data released by NPD Group, a Port Washington, N.Y.-based market research firm. Wal-Mart’s market share rose from 16.3% and Toys R Us’ fell from 18.3% in 1997. “It was inevitable that Wal-Mart would get to the position that they were ahead of Toys R Us,” said Sean McGowan, a toy analyst at Gerard Klauer Mattison. “They are building stores at a faster pace and using toys to build traffic.” The other toy retailers in the top five include Kmart, with an 8% market share; Target, with 6.9%; and KB Toys, with 4.9%. The news of Toys R Us’ slide in market share comes just days after the Paramus, N.J.-based company said its president and chief operating officer had resigned. Earlier this month, the company also reported that its fourth-quarter earnings fell 18% from a year ago. On the New York Stock Exchange, Wal-Mart shares rose $3.44 to close at $95; Toys R Us gained 38 cents to close at $18.