• Reuters, Friday, September 24, 2010 10:53 AM

Dhanya Skariachan breaks the story that Sears will permanently allocate 1,500 to 1,800 square feet of floor space for toys at 85 existing Sears stores next month. The shops are primarily aimed at moms of two-to-five year olds.

"We have a very aggressive plan for growing our toy business," says Julia Fitzgerald, CMO for Sears' toy business. Sears ran a pilot program in 20 department stores last year that proved the concept. The stores will carry products from makers such as Mattel, LeapFrog Enterprises and Schylling, a maker of retro products such as tin jack-in-the-boxes.

Sears' Kmart unit, meanwhile, released its top holiday list of toys, including Mattel's Barbie Video Girl doll and "Paper Jamz," an electric guitar made of cardboard.

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